Court Opinion

ID: 1065066
Source: CourtListenerOpinion
Date Created: 2013-10-09 19:19:41.530865+00
Date Added: 2024-06-11T13:21:27.043678
License: Public Domain

Tuesday          19th

          June, 2001.

Department of Professional and
 Occupational Regulation, Board for
 Asbestos and Lead,                                          Appellant,

against      Record No. 1719-99-2
             Circuit Court No. CL98-80

Abateco Services, Inc.,                                      Appellee.

Abateco Services, Inc.,                                      Appellant,

against      Record No. 1780-99-2
             Circuit Court No. CL98-80

Department of Professional and
 Occupational Regulation, Board for
 Asbestos and Lead,                                          Appellee.

                    Upon a Rehearing En Banc

  Before Chief Judge Fitzpatrick, Judges Benton, Willis, Elder,
         Bray, Annunziata, Frank, Humphreys and Clements

          John B. Purcell, Jr., Assistant Attorney
          General (Mark L. Earley, Attorney General;
          Richard B. Zorn, Senior Assistant Attorney
          General, on briefs), for Department of
          Professional and Occupational Regulation,
          Board for Asbestos and Lead.

          Joseph W. Kaestner (Kaestner, Pitney & Jones,
          on briefs), for Abateco Services, Inc.

          By published opinion dated September 26, 2000, a

divided panel of this Court reversed and remanded the decision of

the trial court as to Record Number 1719-99-2, and affirmed the

decision of the trial court as to Record Number 1780-99-2.
Department of Professional and Occupational Regulation, Board for

Asbestos and Lead v. Abateco Services, Inc. and Abateco Services,

Inc. v. Department of Professional and Occupational Regulation,
Board for Asbestos and Lead, 33 Va. App. 473, 534 S.E.2d 352

(2000).   We stayed the mandates of that decision and granted

rehearing en banc.

           Upon rehearing en banc, it is ordered that the stay of

the September 26, 2000 mandates is lifted, and the judgment of

the trial court is reversed and remanded as to Record Number

1719-99-2 and affirmed as to Record Number 1780-99-2 for the

reasons set forth in the majority panel opinion.

           Judges Benton and Annunziata dissent for the reasons

set forth in the panel dissent.   See id. at 484-94, 534 S.E.2d at

358-63.

           This order shall be published and certified to the

trial court.

                               A Copy,

                                    Teste:

                                                   Clerk

                               - 2 -
                                            Tuesday        5th

          December, 2000.

Department of Professional and
 Occupational Regulation, Board for
 Asbestos and Lead,                                        Appellant,

against      Record No. 1719-99-2
             Circuit Court No. CL98-80

Abateco Services, Inc.,                                    Appellee.

Abateco Services, Inc.,                                    Appellant,

against      Record No. 1780-99-2
             Circuit Court No. CL98-90

Virginia Department of Professional and
 Occupational Regulation, Board for
 Asbestos and Lead,                                        Appellee.

                Upon a Petition for Rehearing En Banc

 Before Chief Judge Fitzpatrick, Judges Benton, Coleman, Willis,
    Elder, Bray, Annunziata, Bumgardner, Frank, Humphreys and
                             Clements

          On October 10, 2000 came Abateco Services, Inc., by

counsel, and filed a petition praying that the Court set aside

the judgment rendered herein on September 26, 2000, and grant a

rehearing en banc thereof.

          On consideration whereof, the petition for rehearing

en banc is granted, the mandate entered herein on September 26,

2000 is stayed pending the decision of the Court en banc, and

the appeal is reinstated on the docket of this Court.

                              - 3 -
          The parties shall file briefs in compliance with Rule

5A:35. Abateco Services, Inc. shall attach as an addendum to the

opening brief upon rehearing en banc a copy of the opinion

previously rendered by the Court in this matter. It is further

ordered that Abateco Services, Inc. shall file with the clerk of

this Court twelve additional copies of the appendix previously

filed in this case.

                          A Copy,

                               Teste:

                                        Cynthia L. McCoy, Clerk

                               By:

                                        Deputy Clerk

                              - 4 -
                   COURT OF APPEALS OF VIRGINIA

Present: Judges Benton, Coleman and Humphreys
Argued at Richmond, Virginia

DEPARTMENT OF PROFESSIONAL
 AND OCCUPATIONAL REGULATION,
 BOARD FOR ASBESTOS AND LEAD

v.   Record No. 1719-99-2

ABATECO SERVICES, INC.                         OPINION BY
                                        JUDGE ROBERT J. HUMPHREYS
ABATECO SERVICES, INC.                    SEPTEMBER 26, 2000

v.   Record No. 1780-99-2

DEPARTMENT OF PROFESSIONAL
 AND OCCUPATIONAL REGULATION,
 BOARD FOR ASBESTOS AND LEAD

          FROM THE CIRCUIT COURT OF THE CITY OF HOPEWELL
                   Robert G. O'Hara, Jr., Judge

          Brian J. Goodman, Assistant Attorney General
          (Mark L. Earley, Attorney General; Richard B.
          Zorn, Senior Assistant Attorney General;
          John B. Purcell, Jr., Assistant Attorney
          General, on briefs), for Department of
          Professional and Occupational Regulation,
          Board for Asbestos and Lead.

          Joseph W. Kaestner (Brian R. Pitney;
          Kaestner, Pitney & Jones, on briefs), for
          Abateco Services, Inc.

     The Board for Asbestos and Lead of the Department of

Professional and Occupational Regulation (the "Board") appeals

from a decision of the Circuit Court of the City of Hopewell

reversing the Board's decision to impose a fine on Abateco

Services, Inc. ("Abateco") for refusing to provide the

                                - 5 -
Department of Labor and Industry (the "Department") access to

its records.    The Board contends the trial court erred in

finding that:    (1) Abateco did not violate an existing state or

federal standard regarding asbestos removal; (2) a state or

federal standard did not exist at the time of the violation; (3)

Abateco acted in good faith and, therefore, any violation was

not willful; and (4) the fine imposed by the Board violated the

Excessive Fines clauses of both the United States and Virginia

Constitutions.    In addition, Abateco appeals the trial court's

denial of its request for attorneys' fees.   We consolidated

these appeals and, for the reasons that follow, we affirm in

part and reverse in part and remand.

                           I.   BACKGROUND

     In November, 1994 Abateco was under contract to remove

insulation containing asbestos from the Staunton Correctional

Center, a facility owned and operated by the Virginia Department

of Corrections.   The contractual arrangement between Abateco and

the Commonwealth required Abateco to keep certain records

regarding asbestos removal and to produce the records on demand

by state regulators.   In addition to the contractual

arrangement, various regulations adopted by the Department

required that these records be maintained and produced upon

demand. 1

     1
       Virginia Occupational Safety and Health Standards
§§ 1926.58(k)(4)(ii), 1926.58(m), 1926.58(n)(5)(ii),

                                - 6 -
     On November 22, 1994, an inspector from the Department

requested certain records from Abateco, including employee

medical records, employee asbestos training, employee exposure

to asbestos, and a hazard communications document.    After

consulting with its counsel, Abateco refused to produce the

documents in the absence of a search warrant, citing its privacy

rights under the Fourth Amendment.

     As a result of its refusal to provide the requested

records, the Commissioner of the Department issued a citation

and notification of penalty to Abateco, proposing a civil

penalty totaling $20,000.   Abateco appealed the penalty

assessment to the Circuit Court of the City of Staunton.      The

trial court found Abateco guilty of four willful violations of

the health and safety standards, and it assessed a total penalty

of $9,665.   We affirmed that decision in Abateco Services, Inc.

v. Bell, 23 Va. App. 504, 477 S.E.2d 795 (1996).

     Following our decision, the Board notified Abateco that its

failure to meet applicable state or federal standards when

performing an asbestos project also constituted grounds for

additional disciplinary action by the Board pursuant to Code

§ 54.1-516(A)(3) and Asbestos Licensing Program Regulation

13.6.A.1.    See 18 VAC 15-20-450.   The matter was referred for an

1926.58(n)(5)(iii), 1926.59(e)(4). See 16 VAC 25-175-1926
(adopting the federal Occupational Safety and Health Act
("OSHA") standards and regulations).

                                - 7 -
informal conference pursuant to Code § 9-6.14:11.        In his

proposed findings of fact, the hearing officer found that

Abateco acted in good faith reliance on the advice of counsel in

refusing to provide the records.         The hearing officer further

found no federal or state standard relating to Abateco's right

to demand a search or inspection warrant at the time of the

violations.

        The Board adopted the facts in the hearing officer's

report, but found clear and convincing evidence that Abateco had

failed to meet applicable state standards and had willfully

violated Code § 54.1-516(A)(3).         The Board also found Abateco

failed to meet state standards in violation of Asbestos

Licensing Program Regulation 13.6.A.1.         See 18 VAC 15-20-450.

The Board imposed a sixty-day inoperative suspension of

Abateco's license and a $2,000 fine.

        Abateco appealed the Board's decision to the Circuit Court

of the City of Hopewell, pursuant to the Virginia Administrative

Process Act. 2      Abateco also requested an award of its attorneys'

fees.       By letter opinion, the trial court reversed the Board's

judgment and vacated the suspension and fine.        The trial court

also denied Abateco's request for attorneys' fees.        These

appeals followed.

        2
            Code § 9-6.14:1 et seq.

                                      - 8 -
             II.   VIOLATION OF AN EXISTING STATE STANDARD

        Because the issues are interconnected, we consider together

the Board's arguments that the trial court erred in reversing

the Board's finding that Abateco violated an existing federal or

state standard and that the trial court erred in finding that no

federal or state standard existed.       Abateco successfully argued

below that it did not violate any state or federal standard

based on our previous holding that Abateco contractually

consented to access to its records without the requirement of a

warrant.     See Abateco, 23 Va. App. at 518, 477 S.E.2d at 801-02.

Abateco contends this holding left open the issue of whether the

records would have been available without a search warrant.

Abateco does not dispute that the regulations promulgated by the

Board existed on November 22, 1996, but contends the regulations

were not enforceable unless and until we determined whether,

absent a waiver, a search or inspection warrant was required

pursuant to Code §§ 40.1-49.8 and 40.1-49.9.

        We find this argument unpersuasive.    In reviewing an agency

decision, the trial court must determine:      (1) whether the

agency acted in accordance with law; (2) whether the agency made

a procedural error which was not harmless error; and (3) whether

the agency had sufficient evidential support for its findings of

fact.     See Johnston-Willis v. Kenley, 6 Va. App. 231, 242, 369
S.E.2d 1, 7 (1988).

                                 - 9 -
       Whether a warrant is necessary is a legal, procedural

issue, not a safety and health standard.    The level of deference

accorded to an agency decision depends upon the nature of the

question involved.    "[W]here 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."    Id. at 244, 369 S.E.2d at 8.

Heightened deference is not required where the issue is one in

which the courts have a special competence.     See id. at 243-44,

369 S.E.2d at 7-8.    "Thus, where the legal issues require a

determination by the reviewing court whether an agency has, for

example, accorded constitutional rights, failed to comply with

statutory authority, or failed to observe required procedures,

less deference is required . . . ."     Id. at 243, 369 S.E.2d at

7-8.

       Based upon this standard of review, we find that a safety

and health standard existed that required the production on

demand of the required records.   The issue of whether Abateco

could interpose any protection under the Fourth Amendment to

require a warrant is a legal issue, falling outside the

specialized competence of the Board.    Therefore, "little

deference [wa]s required to be accorded the [Board's] decision"

by the trial court.    Id. at 246, 369 S.E.2d at 9.

                               - 10 -
       However, the trial court was bound to apply our prior

finding that Abateco contractually consented to produce the

records on demand and without requiring a warrant.     See Abateco,

23 Va. App. at 518, 477 S.E.2d at 801-02.    Therefore, the trial

court erred in reversing the Board's findings that standards

existed requiring the production of certain records and that

Abateco violated these standards.

          III.   GOOD FAITH AS NEGATING A WILLFUL VIOLATION

       We previously affirmed a finding on these facts by the

Circuit Court of the City of Staunton that Abateco's refusal to

produce the records constituted a willful violation of Code

§ 40.1-51.21.    See Abateco, 23 Va. App. at 518, 477 S.E.2d at

802.   Nevertheless, Abateco argued, and the trial court agreed,

that the hearing officer's finding that Abateco acted "in good

faith reliance on the advice of counsel," when adopted by

reference by the Board in its final order, negates any legal

conclusion that Abateco acted willfully to violate such state

standards.   We disagree.

       "Good faith" and "willfulness" are not mutually exclusive

terms.   An act is deemed to have been committed in good faith if

it is done honestly and without fraud or deceit.     See Lawton v.

Walker, 231 Va. 247, 251, 343 S.E.2d 335, 337-38 (1986).

"[C]onduct is 'willful' when it is intentional."     Angstadt v.

Atlantic Mut. Ins. Co., 254 Va. 286, 293, 492 S.E.2d 118, 122

(1997) (quoting RF&P Corp. v. Little, 247 Va. 309, 320, 440

                                - 11 -
S.E.2d 908, 915 (1994)).    The word "willful" also has been

defined, in a non-criminal law context, as denoting an act that

is intentional, knowing, or voluntary.      See United States v.

Murdock, 290 U.S. 389, 394 (1933), overruled in part, on other

grounds, by Murphy v. Waterfront Comm'n, 378 U.S. 52 (1964).       In

the context of the federal Occupational Safety and Health Act

(OSHA), "willful" has been defined as "'an intentional disregard

of, or plain indifference to, OSHA requirements.'"      Reich v.

Trinity Indus., Inc., 16 F.3d 1149, 1152 (11th Cir. 1994)

(citation omitted).    An employer's good faith belief is

irrelevant to the question of whether an employer "willfully"

violated the law.     Id. at 1154.   Thus, regardless of whether

Abateco could constitutionally demand that the Board obtain a

warrant to conduct an inspection of the records upon its

premises, Abateco was required by VOSHA regulations and contract

to provide the Board access to its employees' medical and health

records and refusing to provide access to these records was a

willful violation of these standards.

     The trial court's letter opinion does not indicate the

weight the trial court gave to its finding of good faith when

deciding to reverse the Board's finding that Abateco's conduct

was "willful."   However, we hold that, to the extent the trial

court determined that the finding of good faith on the part of

Abateco necessarily required the trial court to set aside the

factual finding of the Board that Abateco's conduct was

                                - 12 -
"willful," for the reasons stated herein, this determination was

erroneous.

                       IV.   EXCESSIVE FINES

     The Board argues that the trial court erred in finding that

the $2,000 fine imposed by the Board was excessive under the

Eighth Amendment of the Constitution of the United States and

Article I, § 9 of the Constitution of the Commonwealth of

Virginia.
     Abateco argues the $2,000 fine imposed by the Board was

unconstitutionally excessive because Abateco had previously been

sufficiently punished by a fine imposed by the Department.    In

other words, Abateco suggests that multiple civil penalties

imposed by different regulatory authorities for the same conduct

are unconstitutionally excessive, regardless of the amount of the

penalties.

     As the Board noted, there is no Virginia case law applying

the excessive fines provision of Article I, § 9 of the

Constitution of Virginia to a situation where multiple state

agencies have imposed civil penalties for the same conduct.    In a

criminal context, the Supreme Court of Virginia has stated that

in order to violate this constitutional provision, a punishment

must "in quantum . . . be so out of proportion to the crime as to

shock the conscience . . . ."    Hart v. Commonwealth, 131 Va. 726,

745, 109 S.E. 582, 588 (1921).

     The Eighth Amendment to the United States Constitution is

modeled on and congruent with its companion clause in the

Constitution of Virginia.    See Solem v. Helm, 463 U.S. 277, 285

n.10 (1983).   These constitutional provisions are based upon the

                                - 13 -
principle that punishment should be proportionate to the crime.

The Magna Carta itself provided that "'[a] free man shall not be

fined for a small offence, except in proportion to the measure of

the offence; and for a great offence he shall be fined in

proportion to the magnitude of the offence, saving his freehold

. . . .' Art. 20."     Harmelin v. Michigan, 501 U.S. 957, 967

(1991) (citation omitted).

     In Solem, Justice Powell traced the antecedents of the

protection from excessive fines and cruel and unusual punishment

from the Magna Carta through the First Statute of Westminster, 3
Edw. Ch. I, ch. 6 (1275), the English Bill of Rights, The Virginia

Declaration of Rights, authored by George Mason in 1776, to the

Eighth Amendment.     See Solem, 463 U.S. at 284-85.   The Virginia

Declaration of Rights still lives as Article I of the

Constitution of Virginia.

         When the framers of the Virginia Declaration of Rights and

the Eighth Amendment adopted the provision prohibiting excessive

fines and cruel and unusual punishment embodied in the English

Declaration of Rights, they were simply adopting the principle
                                                                      3
that the punishment should not be disproportionate to the crime.
     Abateco has not raised any issue of former jeopardy.

Indeed, in its argument, Abateco cites Smolka v. Second Dist.

Comm'n, 224 Va. 161, 165, 295 S.E.2d 267, 269 (1982), and

concedes the authority of both the Board and the Commissioner of

     3
        The English Bill of Rights provided in pertinent part
"excessive Bail ought not to be required, nor excessive Fines
imposed; nor cruel and unusual Punishments inflicted." An Act
Declaring the Rights and Liberties of the Subject, and Settling
the Succession of the Crown, 1 W. & M. 2, ch. 2 (1689) (Eng.).

                                - 14 -
the Department to regulate the company. 4   Furthermore, Abateco

cites no authority for a construction of the Excessive Fines

clause that prohibits the imposition of civil sanctions by

multiple regulatory authorities, and we have found no such

authority.

     In examining a punishment for unconstitutional excessiveness

vis-a-vis the Eighth Amendment in a criminal context, the United

States Supreme Court has noted two relevant factors the courts

must bear in mind:   (1) judgments about the appropriate

punishment belong, in the first instance, to the legislature, and

(2) any judicial determination regarding the gravity of a

particular offense will be inherently imprecise.       See United

States v. Bajakajian, 524 U.S. 321, 336 (1998).    Against the

backdrop of these considerations, the United States Supreme Court

adopted the standard of "gross disproportionality" articulated in

its Cruel and Unusual Punishment precedents.     Id.   In simple

terms, if the punishment is grossly disproportional to the

offense, given its nature and the actual or potential harm

involved, such punishment is unconstitutional.    We find this

approach to be reasonable and adopt a similar standard for the

construction of Article I, § 9 of the Constitution of Virginia.

     In applying this standard to the facts of this case, we

repeat our earlier observations with respect to the context of

Abateco's conduct:   "[a]sbestos removal is a highly regulated

     4
       The constitutional double jeopardy argument in the context
of civil penalties imposed by multiple regulatory agencies has
also been rejected by the federal courts. See Jones v. Sec. &
Exch. Comm'n, 115 F.3d 1173, 1183 (4th Cir. 1997), cert. denied,
523 U.S. 1072 (1998).

                              - 15 -
industry in Virginia.   Asbestos removal and asbestos disposal

present health and safety hazards to the public and in the

workplace."   Abateco, 23 Va. App. at 513, 477 S.E.2d at 799.

     In addition to Code § 40.1-51.22, authorizing the

Department's imposition of fines for violations, the General

Assembly has authorized further sanctions imposed by the Board

for willful violations of state or federal standards.    See Code

§ 54.1-517.   The $2,000 civil penalty imposed by the Board, even

when combined with the fine imposed by the Department, is well

below the maximum amount authorized by the General Assembly that

could have been imposed in this case.   See Code §§ 40.1-51.22 and

54.1-517.   We find that the additional penalty imposed on Abateco

by the Board was not grossly disproportional to the offenses

committed by Abateco, and the imposition of the Board's penalty

does not offend either the Virginia or United States

Constitutions.

                              - 16 -
                         V.   ATTORNEY'S FEES

     Abateco appeals the trial court's denial of its application

for reasonable attorney's fees pursuant to Code § 9-6.14:21(A). 5

Because Abateco did not substantially prevail on the merits, and

because we find no evidence that the Board's position was "not

substantially justified," we find no error in the failure of the

trial court to award attorney's fees.

     Accordingly, we affirm the decision of the trial court with

respect to attorney's fees and reverse and remand with respect to

the remaining issues for further proceedings consistent with this

opinion.

                              Affirmed as to Record Number 1780-99-2.

               Reversed and remanded as to Record Number 1719-99-2.

     5
         Code § 9-6.14:21(A) provides:

            In any civil case brought under Article 4
            (§ 9-6.14:15 et seq.) of this chapter and
            § 9-6.14:4.1, in which any person contests
            any agency action, as defined in § 9-6.14:4,
            such person shall be entitled to recover
            from that agency . . ., reasonable costs and
            attorney fees if such person substantially
            prevails on the merits of the case and the
            agency's position is not substantially
            justified, unless special circumstances
            would make an award unjust. The award of
            attorney fees shall not exceed $25,000.

                                 - 17 -
Benton, J., dissenting.

     The proceeding that culminates in this appeal was commenced

by the Virginia Board for Asbestos and Lead, see Code

§§ 54.1-500 through 54.1-501, as a disciplinary action against

Abateco Services, Inc., pursuant to Code § 54.1-516(A)(3), Code

§ 54.1-517, and 18 VAC 15-20-450.   The Board alleged that

Abateco failed to meet applicable federal or state standards

when it "refus[ed] to permit an inspection [of its records at an

asbestos project] in the absence of a warrant."   The Board

relied upon citations issued by the Department of Labor and

Industry and our decision in Abateco Servs., Inc. v. Bell, 23
Va. App. 504, 477 S.E.2d 795 (1996).

     At the administrative hearing, Dr. R. Leonard Vance, who is

"a university professor at the Medical College of Virginia . . .

[,] a licensed attorney and licensed engineer," testified that

he had previously been the "Director of Health Standards for

U.S. Occupational and Safety Health Administration at [the] U.S.

Labor Department . . . [and] spent six years as an Assistant

Attorney General as legal counsel to the state OSHA program."

He "supervised the preparation of the current federal asbestos

OSHA standards . . . [; he is] a member of the Board for

Asbestos and Lead in Virginia and participated in the

development of Virginia's asbestos regulations . . . [; and he]

wrote the only book ever written on the Virginia State OSHA

program."   Dr. Vance testified that, while acting as legal

                              - 18 -
counsel for Abateco in 1994, he advised Abateco "that in [his]

opinion, . . . the company was entitled to demand a warrant"

when the Department attempted to conduct an inspection of

Abateco's records.   His advice was based upon the following:

(i) "a Virginia Supreme Court case," see Mosher Steel-Virginia,

Inc. v. Teig, 229 Va. 95, 327 S.E.2d 87 (1985); (ii) Virginia

statutes relating to administrative warrants for inspections,

see Code §§ 40.1-49.8 and 40.1-49.9; (iii) "the traditional

practice in Virginia . . . universally to obtain a warrant any

time that a contractor declines to give consent"; and (iv) case

law from a United States Court of Appeals requiring OSHA to

obtain search warrants for records, see, e.g., National

Engineering & Contracting Co. v. Occupational Safety and Health

Review Comm'n, 45 F.3d 476 (D.C. Cir. 1995); Tri-State Steel

Const., Inc. v. Occupational Safety & Health Review Comm'n, 26
F.3d 173 (D.C. Cir. 1994).   Dr. Vance testified that he has

given similar advice to members of the enforcement staffs at

state and federal OSHA commissions and to other asbestos

contractors.

     Following the hearing, the administrative hearing officer

found as a fact that the Department was "attempt[ing] to conduct

an unannounced inspection at Abateco's work site under the

authority of . . . Code [§] 40.1-51.21" when Abateco's legal

counsel "advised Abateco that it had a right to request the

inspector to obtain a search warrant prior to the commencement

                              - 19 -
of the inspection."   In addition to finding that Abateco relied

upon its legal counsel's advice, the hearing officer further

found as a fact that in a later meeting held to discuss the

impasse, "the representative from the Department . . . stated

[to Abateco's agents] that he believed . . . Abateco had the

right to demand a search warrant prior to any inspection . . .

[, that the representative] indicated . . . he would attempt to

obtain a search warrant . . . [, and that] no such warrant was

ever issued."   Indeed, the hearing officer found as a fact that

on a previous occasion when the Department "had attempted a

similar inspection of Abateco's work site on a different job

. . . , Abateco refused to allow the inspection without a search

warrant . . . and Abateco was not cited for that action."   Based

on the evidence at the hearing, the hearing officer also found

as a fact that "Abateco reasonably and in good faith believed

that it had a right to refuse the state inspection absent a

search warrant."

     The hearing officer noted that when Abateco refused to

allow the inspection without a warrant "an apparent conflict

[existed] between . . . sections of the Code of Virginia," see

Code §§ 40.1-51.21, 40.1-49.8, and 40.1-49.9, that had not been

resolved by the courts.   He further found as a fact that during

the trial of the matter that led to our Abateco decision, "the

Commonwealth agreed that this was an issue of first impression

in Virginia."   Significantly, the hearing officer also found as

                              - 20 -
a fact that in the Abateco trial, "Abateco's reliance on the

advice of counsel as a defense as to the willful elements of the

citations was not raised or litigated."    The hearing officer,

thus, concluded that "[i]n requiring a warrant prior to

inspections, Abateco was relying on a good faith belief that it

had a statutory and constitutional right to do so" and that

"[t]he validity of the assertion of this right under the

particular set of facts could only be determined by a court of

law."    Noting "that Abateco acted in good faith and not for the

purpose of evading or impeding the regulatory efforts of the

Department," the hearing officer "recommend[ed] the decision

that Abateco did not violate a federal or state standard that

existed . . . when it refused to allow the document inspection."

        Without exception, the Board "adopt[ed] the facts in the

hearing officer's report."    The Board ruled, however, that

despite those facts Abateco violated 18 VAC 15-20-450 and Code

§ 54.1-516(A)(3) and levied monetary penalties.

        On appeal to the circuit court, Abateco argued that because

the issue was one of first impression in Virginia in 1994 and

the facts, adopted by the Board, proved Abateco acted in good

faith upon the advice of legal counsel, the decision of the

Board was not supported by the evidence.    Significantly, the

Board argued, in pertinent part, as follows:

             The only issue the Board was authorized by
             law to consider is was the violation

                                - 21 -
willful, and the Court of Appeals [in
Abateco] said yes, it was.

   Now, is the Board absolutely required to
accept the decision of the Court of Appeals?
In this situation, no, it was not. But what
the Board has in a situation of this kind is
reasonable discretion, and the Board in its
reasonable discretion decided that it would
accept the findings of the Court of Appeals
and the Circuit Court, that the violations
were willful, which means the Board never
had to get into the issue of the good faith
by contacting their attorney, they didn't
have to get into the question of whether
this was an instance of first impression,
they only had to look to see the
willfulness.

   Now, let's take a look for just a moment
at the first impression issue. What Abateco
is saying is it is still an open question in
a situation of this kind absent a contract
provision, because the Court of Appeals is
very clear, where there was a contract
provision which waived the contractor's
rights to require a warrant, the issue of
requiring a warrant is still open. We don't
know what the answer to that is going to be,
and we will not find out in this case. It
is not an issue that is before this court.
Is it a standard? What the law says is
there must be a willful violation of a
standard of the Department of Labor and
Industry.

   These are the standards that were in
effect when this took place in 1994. You
can look all through this, Your Honor. You
will not see anything in there which relates
directly to this issue.

   The question of whether or not you have
to have a warrant to conduct a search of
this kind is a legal argument. It is not a
standard of the Department of Labor and
Industry.

                   - 22 -
              The standards go to the technical issues
           of what the contractor is required to do to
           provide for the safety and health of his
           workers and the community in general. Those
           are the standards.

              Were they violated? The Circuit Court
           and the Court of Appeals said yes. There
           were four of these standards that were
           violated.

              Were they technical violations that would
           not directly impact upon the health or
           safety of any person. Yes, they were.

(Emphasis added).

     The trial judge reversed the Board's decision and ruled as

follows upon his review of the record:

              that ABATECO did not violate an existing
           federal or state standard when it refused to
           allow the subject document inspection;

              that the BOARD was in error in deciding
           that state or federal standards existed at
           the time of the violation;

              that ABATECO relied upon the advice of
           counsel and acted in good faith; . . . .

     I believe the trial judge correctly ruled that the Board

did not act in accordance with the law and that the Board lacked

sufficient evidential support for its decision.   See

Johnston-Willis v. Kenley, 6 Va. App. 231, 242, 369 S.E.2d 1, 7

(1988).   The hearing officer found and the Board adopted as a

fact that "Abateco acted in good faith, and not for the purpose

of evading or impeding the regulatory efforts of the

Department."   That issue was not litigated or decided in our

Abateco decision.

                              - 23 -
     I believe that, properly viewed, Abateco only decided the

issue of the contractual obligation of the parties and the

consequences of Abateco's breach of that contract.   In that

case, we ruled as follows:

             We hold that Abateco had a diminished
          expectation of privacy in the requested
          records; however, we further hold that it
          contractually waived whatever Fourth
          Amendment rights it possessed in the
          records. Because Abateco could not
          unilaterally revoke its contractual waiver
          of Fourth Amendment rights without breaching
          the terms of the contract, the Department
          had the right to inspect the records without
          a search warrant, provided it could
          reasonably do so without breaching the
          peace. Accordingly, because the Department
          was not required to obtain a warrant in
          order to obtain access to the records, the
          citations issued by the Department were
          founded. Furthermore, the penalty of $9,665
          assessed by the trial court was reasonable
          and within the range provided for in Code
          § 40.1-49.4(A)(4)(a). Therefore, we hold
          that the trial court did not err in
          upholding the citations and the penalty
          imposed by the trial court was not
          excessive.

23 Va. App. at 508, 477 S.E.2d at 797.

     This limited reading of our holding is clearly supported by

the following disclaimer that we made in Abateco:

          Having determined that Abateco has a
          diminished expectation of privacy in these
          records, the question remains whether,
          absent a waiver of Fourth Amendment rights,
          a warrant is required. We do not have to
          decide that question because Abateco
          contracted with the commissioner to provide
          access to the records upon request without
          requiring a warrant and Abateco cannot
          unilaterally withdraw that consent, which

                             - 24 -
          was a condition of its bargain to perform
          the asbestos removal.

Id. at 515, 477 S.E.2d at 800.   As a matter of contract law,

this conclusion necessarily follows from the holding and does no

more than assert the unremarkable proposition that the

Department had a remedy for Abateco's breach of contract.     See,

e.g., Haythe v. May, 223 Va. 359, 361, 288 S.E.2d 487, 488

(1982) (holding that courts will grant specific performance of a

contract if its enforcement will not be inequitable to a

defendant and refusal will damage the other party); Snead v.

Commonwealth, 212 Va. 803, 804, 188 S.E.2d 197, 198 (1972)

(holding that where an entry onto property was lawful and

peaceful, a refusal to leave upon an order does not constitute

an offense).   Indeed, we specifically observed that "because

Abateco had contractually consented to access of its records

without requiring a warrant, the trial court did not err in

upholding the Department's citations."     Abateco, 23 Va. App. at

518, 477 S.E.2d at 802 (emphasis added).

     The matter at issue before the Board in this proceeding was

whether Abateco "violat[ed] any provision of . . . Title 54.1 of

the Code of Virginia."   18 VAC 15-20-460.   Specifically, the

Board's inquiry was whether Abateco "fail[ed] to meet any

applicable federal or state standard when performing an asbestos

project or service."   I find no statutory basis for concluding

that the Board, in this proceeding, was authorized to levy a

                              - 25 -
civil penalty against Abateco solely for Abateco's breach of a

contract with the Department.    Certainly, the Board pointed to

no provision in the contract that permits such a remedy.

Moreover, nothing in Code § 40.1-49.4(A)(4)(a), the provision

the Department apparently relied upon in Abateco, see 23 Va.

App. at 511, 477 S.E.2d at 798, permits the Board to levy upon a

contractor a civil penalty for breach of contract.

     By its regulations, see 16 VAC 25-175-1926, the Department

has adopted by reference to 29 CFR 1926 various provisions of

the federal OSHA regulations as provisions of the Virginia

Occupational Safety and Health regulations.   Those federal

regulations require an employer such as Abateco to maintain and

permit access by the regulatory agency to specific records.

See, e.g., 29 CFR 1926.58(f); 1926.58(k)(4)(ii); 1926.58(m);

1926.58(n)(5)(ii) and (ii); and 1926.58(e)(4).   The right of

access to those records is delimited, in pertinent part, as

follows:

           Each employer shall, upon request, and
           without derogation of any rights under the
           Constitution or the Occupational Safety and
           Health Act of 1970, 29 U.S.C. 651 et seq.,
           that the employer chooses to exercise,
           assure the prompt access of representatives
           of the Assistant Secretary of Labor for
           Occupational Safety and Health to employee
           exposure and medical records and to analyses
           using exposure or medical records.

29 CFR § 1910.1020(e)(3)(i) (emphasis added).

                                - 26 -
     Although upon advice of counsel Abateco refused to allow

the Department to inspect Abateco's records without a warrant,

the Department has never alleged or proved that Abateco did not,

in fact, maintain the proper records.    Indeed, the hearing

officer found as a fact and the Board adopted the finding that

"[t]he records sought by the Department . . . were produced by

Abateco . . . [; consequently] no additional citations were

brought against Abateco based upon the records that were

produced."    The Department alleged a violation of Code

§ 40.1-51.21, which provides as follows:

             At least once a year, during an actual
             project, the Department of Labor and
             Industry shall conduct an on-site
             unannounced inspection of each licensed
             asbestos contractor's, licensed RFS
             contractor's, and certified lead
             contractor's procedures in regard to
             installing, removing and encapsulating
             asbestos and lead. The Commissioner or an
             authorized representative shall have the
             power and authority to enter at reasonable
             times upon any property for this purpose.

     Relying upon his interpretation of Code § 40.1-49.8 and

Code § 40.1-49.9, Abateco's counsel, who had extensive

experience as a regulator and as counsel to the regulators,

advised Abateco that it could withhold its consent and require

the Department to obtain a search warrant for access to the

records.   Indeed, Code § 40.1-49.8 specifically addresses the

use of warrants in the inspection of workplaces:

             In order to carry out the purposes of the
             occupational safety and health laws of the

                                - 27 -
          Commonwealth and any such rules,
          regulations, or standards adopted in
          pursuance of such laws, the Commissioner,
          upon representing appropriate credentials to
          the owner, operator, or agent in charge, is
          authorized, with the consent of the owner,
          operator, or agent in charge of such
          workplace as described in subdivision (1) of
          this section, or with an appropriate order
          or warrant:

          (1) To enter without delay and at reasonable
          times any factory, plant, establishment,
          construction site, or other area, workplace
          or environment where work is performed by an
          employee of an employer; and

          (2) To inspect, investigate, and take
          samples during regular working hours and at
          other reasonable times, and within
          reasonable limits and in a reasonable
          manner, any such place of employment and all
          pertinent conditions, structures, machines,
          apparatus, devices, equipment, and materials
          therein, and to question privately any such
          employer, owner, operator, agent or
          employee.

As an adjunct to this statute, Code § 40.1-49.9 addresses the

requirements of probable cause for the issuance of warrants and

clearly applies to industries that have a "high hazard ranking."

     The record in this case is undisputed that Abateco acted in

good faith upon its experienced counsel's advice in asserting

constitutional, statutory, and case decision grounds for

requiring the Department to obtain a search warrant to inspect

its records.   When an entity, "while acting in good faith with

the advice of counsel, failed to comply with the provisions of

the Act," the evidence clearly establishes that "there were no

willful and knowing violations."   Nageotte v. Board of

                              - 28 -
Supervisors of King George County, 223 Va. 259, 269, 288 S.E.2d
423, 428 (1982).   Defining "willful," the Supreme Court of

Virginia has recently cited with approval United States v.

Murdock, 290 U.S. 389, 394 (1933).     See Angstadt v. Atlantic

Mutual Ins. Co., 254 Va. 286, 293, 492 S.E.2d 118, 122 (1997).

The United States Supreme Court more recently explained the

Murdock definition of "willful" as follows:

          While a criminal defendant, like an
          employer, need not have knowledge of the law
          to act "knowingly" or intentionally, he must
          know that his acts violate the law or must
          "careless[ly] disregard whether or not one
          has the right so to act" in order to act
          "willfully." United States v. Murdock, 290
U.S. 389, 395 (1933) . . . . We have
          interpreted the word "willfully" the same
          way in the civil context. See McLaughlin v.
          Richland Shoe Co., 486 U.S. 128, 133 (1988)
          (holding that the "plain language" of the
          Fair Labor Standards Act's "willful"
          liquidated damages standard requires that
          "the employer either knew or showed reckless
          disregard for the matter of whether its
          conduct was prohibited by the statute,"
          without regard to the outrageousness of the
          conduct at issue).

Kolstad v. American Dental Assn., 527 U.S. 526, 549 (1999)

(citation omitted).

     Furthermore, even if Abateco's breach of its contractual

obligation to consent was willful and designed to require the

Department to obtain a warrant for inspection, that conduct does

not ipse dixit become a willful violation of Code § 40.1-51.21.

"The definition of 'willful' . . . is, in its simplest form, 'an

intentional disregard of, or plain indifference to, OSHA

                              - 29 -
requirements."     Reich v. Trinity Indus., Inc., 16 F.3d 1149,

1152 (11th Cir. 1994).     See also Brockaway v. Easter, 20 Va.

App. 268, 271, 456 S.E.2d 159, 161 (1995) (holding that

"'[w]illful' . . . involves the idea of premeditation and

determination to do the act, though known to be forbidden").

     The hearing officer found as a fact that Abateco relied

upon the advice of counsel and its prior course of conduct with

the Department in asserting that it could require, consistent

with the statutory framework, a warrant for inspection of its

records.   Moreover, the Board adopted all the hearing officer's

factual findings, including the fact that Abateco was acting in

good faith when it relied upon its counsel's advice.    Thus, in

my opinion, the trial judge did not err in ruling that the Board

had no basis upon which to impose civil penalties under Code

§§ 54.1-516 or 54.1-517.

     In Abateco, we held only that the Department retained a

contractual right of entry that negated any privacy claim that

Abateco alleged.    Even if we assume, however, that our decision

in Abateco resolved the issue whether a violation of Code

§ 40.1-51.21 occurred when Abateco breached its contract and

required the Department to obtain a warrant for the records, I

believe the hearing officer correctly noted that the legal

issue, which "appeared to revolve around an apparent conflict

between [Code §§ 40.1-49.8, 40.1-49.9, and 40.1-51.21] of the

Code of Virginia," had not been decided in 1994 when Abateco

                                - 30 -
demanded that the Department obtain the warrant.   As the

majority correctly notes "[w]hether a warrant is necessary is a

legal, procedural issue, not a safety and health standard."

     For these reasons, I would affirm the trial judge's order.

I respectfully dissent.

                             - 31 -