Opinion ID: 328974
Heading Depth: 2
Heading Rank: 2

Heading: The Joint Venture Petition

Text: 22 Section 9 of OSHA, 29 U.S.C. § 758 provides in pertinent part: 23 (a) If, upon inspection or investigation, the Secretary . . . believes that an employer has violated a requirement of (the Act) . . . he shall with reasonable promptness issue a citation to the employer. . . . 24 (c) No citation may be issued under this section after the expiration of six months following the occurrence of any violation. 25 There is no question that a joint venture is an employer within the meaning of the Act. The term employer means a person engaged in a business affecting commerce, § 3(5), 29 U.S.C. § 652(5), and (t)he term 'person' means one or more individuals, partnerships, associations, corporations, business trusts, legal representatives, or any organized group of persons. § 3(4), 29 U.S.C. § 652(4). Thus there is no question that the Secretary could have issued a citation to the joint venture, which was the actual employer on the site and which was so identified by a sign posted there. 26 The government argues that service of the citations and notices of proposed penalties on one member of the joint venture was sufficient service of process on the joint venture; especially so when that service was on Bloomfield, which under the terms of the joint venture agreement had primary managerial responsibility. We agree, and if the citations and notice had named the joint venture, the inquiry could end here. But it is quite clear from the Secretary's pleadings that he intended to cite Bloomfield, not the joint venture. This is not a case in which notice and process were served on the joint venture through one of its members, or a case of a misnomer, when the proper party was served but misidentified. When the citations and notice were served, and even when the complaint was filed with the Commission, the Secretary was unaware that a joint venture was the employer on the site. It was not until April 6, 1973 that the Secretary was made aware of this fact. 27 The violations charged took place on November 21, 1972. The time within which a citation could have been issued to the proper employer was May 21, 1973. 29 U.S.C. § 658(c). The May 3, 1973 ruling which granted the Secretary's motion for leave to amend the complaint was made, then, before the running of the six month statute of limitations. But the Secretary did not, prior to May 21, 1973, either issue a new citation, file an amended citation, or file an amended complaint. The amended complaint was not filed until June 6, 1973, and even then the citation was not amended. 28 It is the citation which serves as the statutory vehicle for notice of the violation, 29 U.S.C. § 658(a), and it is the notice of proposed penalty which serves as the process which triggers the penalty enforcement mechanism. 29 U.S.C. § 659(a) & (b). Provision for the issuance of a complaint is not even expressly mentioned in the statute. See 29 U.S.C. § 659(c). The complaint procedure is a creature of administrative regulation, 29 CFR § 2200.33, and the regulations recognize the necessity for amending the citation. 29 CFR § 2200.33(3). In this case, the Secretary failed to amend the complaint until the statute of limitations had run, and failed to amend the citation at any time. Thus we conclude that no service of the process contemplated by the Act was made upon the joint venture within the period permitted by 29 U.S.C. § 658(c). 29 The Secretary urges that by answering the June 6, 1974 amended complaint, the joint venture waived the jurisdictional defect of failure to timely serve a citation on it, but it is clear that at all times from May 3, 1973 forward, counsel for the joint venture took steps to preserve his jurisdictional defense. Moreover since the Secretary could have taken appropriate steps to serve the proper employer between April 6, 1973 and May 21, 1973, but neglected to do so, there is no basis for any assertion that one member of the joint venture misled the enforcement agency so as to cause a tolling of the running of the statute of limitations. Thus there is no basis for an estoppel against the joint venture from pleading the statutory bar. 30 There is, however, one possible approach which might justify a conclusion by the Commission that the joint venture had been timely served. Section 12(g) of the Act, 29 U.S.C. § 661(f) provides in pertinent part: 31 The Commission is authorized to make such rules as are necessary for the orderly transaction of its proceedings. Unless the Commission has adopted a different rule, its proceedings shall be in accordance with the Federal Rules of Civil Procedure. 32 Pursuant to § 661(f), the Commission has promulgated 29 CFR § 2200.2(b), which provides: 33 In the absence of a specific provision, procedure shall be in accordance with the Federal Rules of Civil Procedure. 34 Rule 15(c), Fed.R.Civ.P., deals with the relation back of amendments, and provides in part: 35 An amendment changing the party against whom a claim is asserted relates back if . . . within the period provided by law for commencing the action against him, the party to be brought in by amendment (1) has received such notice of the institution of the action that he will not be prejudiced in maintaining his defense on the merits, and (2) knew or should have known that, but for a mistake concerning the identity of the proper party, the action would have been brought against him. 36 The purpose of the rule is to ameliorate the effect of a statute of limitations where the plaintiff has sued the wrong party but where the right party has had adequate notice of the institution of the action. See 6 C. Wright & A. Miller, Federal Practice and Procedure §§ 1497-1500, at 489-523 (1971). There is certainly a strong likelihood that the Commission would find such identity of interest between Bloomfield and the joint venture that notice to the former would be attributed to the latter. But the administrative law judge did not purport to apply Rule 15(c), and we are not advised of the Commission's position with respect to the extent of its applicability to Commission proceedings. Moreover we do not know whether, assuming applicability of the rule, the Commission would apply it in a case where the Secretary (1) had notice of the jurisdictional defect before the statute of limitations ran, (2) filed the amended complaint after the statute ran, and (3) never amended the citation. 37 Finally, there are procedural difficulties in the application of Rule 15(c) in the OSHA context because of the split in the administrative process between the Department of Labor and the Commission. Relation back may not overcome the difficulty if the joint venture lost the opportunity to negotiate with the Secretary for a mutually satisfactory disposition prior to the filing of the complaint. These are all matters upon which the Commission should pass in the first instance. Therefore the order against the joint venture will be set aside and the proceeding remanded to the Commission for a determination as to whether pursuant to Rule 15(c), the Commission would permit an amendment substituting the joint venture as a party to relate back to the date of the original citation. 38