Court Opinion

ID: 9564583
Source: CourtListenerOpinion
Date Created: 2023-08-21 19:03:36.276873+00
Date Added: 2024-06-11T09:18:32.425760
License: Public Domain

ANDERSON, J.
(dissenting):
I vote to REVERSE. Converse Power Corporation (“Converse”) was entitled to issuance of an aquaculture permit by the Department of Health and Environmental Control (“DHEC”) under the provisions of the pre-amended Regulation 61-47.
FACTS/PROCEDURAL BACKGROUND
Converse appealed the denial of its aquaculture permit request and a contested case hearing was conducted before the Administrative Law Judge (“ALJ”) on May 12, 1998.8 At this hearing, DHEC identified as the “sole basis” for its denial of Converse’s permit was its “inability to perform an inspection” in that there was no facility for DHEC to inspect.
Only two persons testified before the ALJ: E.D. Sloan, Jr., president of Converse, proceeding pro se, and Michael M. Coker, Manager of DHEC’s Shellfish Sanitation Section in the Trident EQC District. During his direct testimony, Sloan introduced the various documents Converse submitted for its permit application. He maintained that “those papers speak for themselves” and they complied with all regulatory requirements necessary for obtaining an aquaculture permit. On cross examination, Sloan admitted that no aquaculture facility has yet been constructed and that he has never operated such a facility before. DHEC additionally questioned Sloan regarding the lack of specificity in the permit application. The ALJ also conducted the following examination:
The Court: Mr. Sloan, if we were to go out and look at 130 Venture Boulevard now, the location, to inspect it, what exactly would we see?
Sloan: You’d see a small, one-story office building and a . parking lot and a grassy area behind it.
The Court: Do you have blueprints or any type of plan that shows what you intend to build there?
*51Sloan: No, sir, and for good reason.
The Court: And what is that reason?
Sloan: I’m unable to design it without knowing the conditions of the permit.
The Court: So your position is that unless and until you have permit, you don’t know exactly what you would build?
Sloan: That’s correct.
(emphasis added).
Coker, on the other hand, testified an aquaculture permit is required merely for the operation of the aquaculture facility and that construction can take place without the permit being issued. He explained the permitting requirements are “public health based” and designed to “make sure a healthy product reaches the market.” Since shellfish are “filter feeders,” i.e., entities that take up any organisms or contaminants in the water and retain it in their bodies, the need to properly regulate aquaculture facilities to protect the public’s health is heightened. Coker testified that when inspecting an aquaculture facility, DHEC looks to the construction of the facility, its water flow, its materials, its water source, the type of shellfish cultivated, the facility’s operating plan, and anything else “that could be constructed in such a manner it could have an impact on the quality of the shellfish.” Coker then explained why Converse’s permit was denied:
Based on correspondence with Mr. Sloan’s company, there has been no facility constructed, was the primary reason. Additionally, the S.O.P., I call it, the management plan, that was submitted did not contain all the detail we would like to see ultimately, however, we allowed the process, the application process, to continue with what he had provided.
So I would say the bottom line, the stopper, was the fact that there was no facility and we could not conduct that initial permit issuance inspection. There was nothing for us to go out, look at, and show compliance with his operational plan he had submitted.
(emphasis added).
Lastly, Coker opined, despite the specific language of the pre-amended Regulation 61-47(G)(l)(b)(5), which states “[i]t *52shall be unlawful for any person to relay, distribute in interstate commerce, distribute to a certified shipper, harvest for depuration, deplete, wet store, conduct aquaculture activities, or process shellfish who does not possess the appropriate valid ... Aquaculture Permit,” that the regulation allows an aquaculture facility to be constructed and shellfish to be grown to test the facility before an initial inspection and permit is given as long as no shellfish are marketed for sale. Coker assured the ALJ that DHEC could provide “any technical assistance necessary” during the construction of the applicant’s facility before the permit is issued to ensure compliance with the regulations.
On June 15, 1998, the ALJ filed its “Final Order and Decision” affirming DHEC’s denial of the aquaculture permit.9 The ALJ’s last six conclusions of law were:
15. Petitioner’s application for an aquaculture permit fails to comply with R. 61-47.G.1.(e).
16. Petitioner’s application fails to meet the requirements of R. 61-47.O.1(d) for a shellfish aquaculture permit.
17. Petitioner’s application fails to meet the requirements of R. 61-47.O.4(d)10 for a land based aquaculture permit.
18. Petitioner’s application is incomplete because it does not include specific, relevant, and necessary information required to be detailed by an applicant seeking an aquaculture permit under R. 61-47.
19. DHEC is unable to make inspections of the proposed shellfish operation, pursuant to R. 61-47.G.2(b), as is necessary to determine compliance with the requirements of R. 61-47.
20. Without the ability to determine whether Petitioner’s shellfish cultivation facility and operation will perform in a manner which produces shellfish safe for human consumption, Petitioner’s application must be denied.
*53Converse appealed to the Board of Health and Environmental Control (“the Board”) for quasi-judicial review of the ALJ’s June 15th Final Order. After extensive correspondence between Sloan and the Board, including an appeal to the Circuit Court regarding which party had the duty to supply the transcript of the record before the ALJ to the Board,11 Converse’s permit application was considered at a regular Board meeting conducted May 13, 1999. On June 29, 1999, the Board issued its two paragraph “Order of the Board,” which found “the Final Order and Decision of the Administrative Law Judge, including its findings of fact and conclusions of law, should be, and hereby is, adopted as the Order of the Board.”
Converse appealed the Board’s Order to the Circuit Court. By order filed March 16, 2000, “[h]aving found sufficient evidence in the record” and concluding DHEC had made a “reasonable interpretation of the regulation,” the Circuit Court affirmed the Board’s determination. Converse appeals.
LAW/ANALYSIS
Section 1-23-380 governs the standard of judicial review in this case. As is similar in a quasi-judicial review of any final decision of an ALJ,12 this Court’s review in the instant action is limited and it is “confined to the record.” S.C.Code. Ann. § l-23-380(A)(5) (Supp.2001).
The court shall not substitute its judgment for that of the agency as to the weight of the evidence on questions of fact. The court may affirm the decision of the agency or remand the case for further proceedings. The court may reverse or modify the decision if substantial rights of the appellant have’been prejudiced because the administrative findings, inferences, conclusions or decisions are:
(a) in violation of constitutional or statutory provisions;
(b) in excess of the statutory authority of the agency;
*54(c) made upon unlawful procedure;
(d) affected by other error of law;
(e) clearly erroneous in view of the reliable, probative and substantial evidence on the whole record; or
(f) arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion.
Id. at (A)(6).
Coker, in his capacity as the DHEC Section Manager for the Shellfish Sanitation Section, stated in his April 24, 1998, letter denying Converse’s aquaculture permit application that the sole reason the permit was denied was because, under Regulation 61-47(G)(2)(b), DHEC was unable to inspect any facility. Likewise, in the ALJ hearing, DHEC confirmed that the sole basis for denial of the permit was its “inability to perform an inspection.” No other issues regarding the sufficiency of Converse’s permit application were identified as issues for review before the ALJ. In fact, after Sloan finished his presentation of his case, which consisted merely of introducing all of the application correspondence to the ALJ, the ALJ denied DHEC’s motion for an involuntary nonsuit because the petition application made by Converse “at least meets the minimum requirements [of the regulation].” Therefore, the ALJ’s findings of fact and conclusions of law regarding purported application deficiencies other than Converse’s lack of any facility for inspection were clearly erroneous, beyond the scope of the ALJ’s review of DHEC’s initial order, and, therefore, not before this Court.
Converse argues DHEC committed an error of law and acted arbitrarily and capriciously in denying the aquaculture permit merely because Converse had not yet constructed an aquaculture facility for DHEC to inspect. I agree.
DHEC is charged with enforcing the provisions of Regulation 61-47 “to protect the health of consumers of shellfish” in South Carolina. 24A S.C.Code Ann. Regs. 61-47(A)(1) (Supp. 2001). Generally, the delegation of authority to an administrative agency is construed liberally when the agency is concerned with the protection of the health and welfare of the public. City of Columbia v. Board of Health & Envtl. Control, 292 S.C. 199, 855 S.E.2d 536 (1987). However, this delegation does not go unchecked. DHEC must follow its own *55regulations and the provisions of the Administrative Procedures Act13 in carrying out the legitimate purposes of the agency. Triska v. DHEC, 292 S.C. 190, 355 S.E.2d 531 (1987). Thus, any action taken by DHEC outside of its statutory and regulatory authority is null and void. Id.
“An administrative body must make findings which are sufficiently detailed to enable this Court to determine whether the findings are supported by the evidence and whether the law has been applied properly to those findings.” Kiawah Property Owners Group v. Public Serv. Comm’n of S.C., 338 S.C. 92, 95-96, 525 S.E.2d 863, 865 (1999) (quoting Porter v. S.C. Public Serv. Comm’n, 333 S.C. 12, 21, 507 S.E.2d 328, 332 (1998)). That is, “[t]his Court will not accept an administrative agency’s decision at face value without requiring the agency to explain its reasoning.” Id. at 96, 525 S.E.2d at 865 (citation omitted).
Regulation 61-47(G)(2) (Supp.1999), titled “Issuance of Permits,” provides:
(a) An application shall be made on a form provided by the Department.
(b) Upon receipt of a completed application form, the Department shall make inspections of the shellfish operation as may be necessary to determine compliance with the applicable provisions of this Regulation;
(c) A permit of certificate may be suspended or revoked as stated in Items H.l(b) and H.l(d).
Regulation 61-47(G)(l)(b) (Supp.1999) provides, among nine other named types of certificates and permits, only one version of “Aquaculture Permit.” “Aquaculture means the cultivation of shellfish in land based artificial growing or harvest areas, or confined in natural growing or harvest areas as designated by permit from South Carolina Department of Natural Resources.” 24A S.C.Code Ann. Regs. 61-47(A)(2)(d) (Supp.1999).14 Furthermore, “Growing area means an area which supports or could support live shellfish” and “Harvester *56means a person who gathers shellfish by any means from a growing area.” 24 A S.C.Code Ann. Regs. 61-47(A)(2)(s) & (t) (Supp.1999).15
As with other forms of statutory construction, the words of a regulation must be given their plain and ordinary meaning without resort to subtle or forced construction to limit or expand the regulation’s operation. Byerly v. Connor, 307 S.C. 441, 415 S.E.2d 796 (1992); see also State v. Dickinson, 339 S.C. 194, 199, 528 S.E.2d 675, 677 (Ct.App.2000), cert. denied (“[T]he cardinal rule of statutory construction is that the court must ascertain and effectuate the intent of the legislature, and in interpreting a statute, the court must give the words their plain and ordinary meaning without resorting to a tortured construction which limits or expands the statute’s operation.”) (citations omitted).
Converse, at all times, has been attempting to obtain an aquaculture permit from DHEC in order to begin cultivating and selling shellfish to the public. Converse’s intended future business clearly falls within the above definitions for an aquaculture activity. As such, before Converse commences with any aquaculture activities of cultivating shellfish, it must obtain a valid aquaculture permit. 24A S.C.Code Ann. Regs. 61-47(G)(1)(b) & (O)(1)(b)(1) (Supp.1999). In light of this lucent permitting requirement, Coker’s opinion that cultivating shellfish as long as they never reach the human consumption market does not violate the regulation is clearly disingenuous. We must apply the regulation as written, not as merely applied by DHEC.
Nowhere, however, does the applicable regulation actually require the facility to be constructed before an aquaculture permit can be issued. The regulation merely requires the proper permit before any aquaculture activities are commenced. DHEC’s correspondence clearly enunciates its desire for more specific information regarding Converse’s plan for operation. Arguably, DHEC could have denied Converse’s permit application for its lack of specificity,16 as the ALJ *57apparently found convincing; however, that issue is not before this court for review. Instead, we are asked to review whether DHEC’s decision to deny Converse’s permit application based solely on the fact that there is not yet an operational facility to inspect. Coker testified that, during a facility inspection, DHEC examines many factors, including whether satisfactory building materials and building designs were used. Thus, if Converse completed a facility, but used inadequate building materials, no permit would be issued. Although Coker offered his assistance to Converse for interim inspections of the facility’s construction, there is likewise no requirement for the permit petitioner to placate DHEC by making substantial investments into constructing an aquaculture facility with no guarantee that the facility will comply with DHEC’s permitting requirements when construction is completed. DHEC’s denial of Converse’s permit request merely because no facility was completed was clearly arbitrary and capricious.
“A decision is arbitrary if it is without a rational basis, is based alone on one’s will and not upon any course of reasoning and exercise of judgment, is made at pleasure, without adequate determining principles, or is governed by no fixed rules or standards.” Deese v. South Carolina State Bd. of Dentistry, 286 S.C. 182, 184-85, 332 S.E.2d 539, 541 (Ct.App.1985) (citing Hatcher v. South Carolina Dist. Council of Assemblies of God, Inc., 267 S.C. 107, 226 S.E.2d 253 (1976) and Turbeville v. Morris, 203 S.C. 287, 26 S.E.2d 821 (1943)). None of the appellate proceedings below corrected DHEC’s initial error in relying solely on its inability to inspect a facility. DHEC’s basis for denying the aquaculture permit was not supported by Regulation 61-47 (Supp.1999).
Indubitably, the majority opinion grants to the Department of Health and Environmental Control the unfettered and unlimited authority to construe its own regulations. This is error. I vote to REVERSE the decision of the circuit judge in affirming the Board’s order.

. Docket No. 98-AU-07-0032-CC.

. Docket No. 98-ALJ-07-0032-CC.

. Although. Regulation. 61-47 (Supp.1999) contains subpart (0)(4) for direction for "Land Based Shellfish Aquaculture permit applicants,” it only contains subsections (a) through (c).

. In its Final Order filed January 27, 1999 (Case No. 98-CP-23-3744), the Circuit Court determined the Board was required to consider the merits of Converse’s appeal "as soon as Converse provides the Board with the transcript of hearing before the Administrative Law Judge.”

. S.C.Code Ann. § 1-23-610 (Supp.2001).

. S.C.Code Ann. §§ 1-23-310 to -660 (1986 & Supp.2001).

. The amendment to this definition merely added: "For purposes of this regulation, aquaculture is synonymous with mariculture.” S.C.Code. Ann. Regs. 61-47(A)(2)(d) (Supp.2001).

. In the amended Regulation 61-47, the definition for "Growing area” is renumbered at (y) and for "Harvester” at (cc).

. 24A S.C.Code Ann. Regs. 61-47(O)(1)(d) (Supp.1999) provides: "Applications for Aquaculture Permits must contain a written operational plan detailing the scope and extent of the operation.”