ILLINOIS POLLUTION CONTROL
BOARD
February
6, 1992
LAWRENCE CADILLAC,
)
)
Petitioner,
)
PCB 91-133
)
(Underground Storage Tank Fund
v.
)
Reimbursement Determination)
)
ILLINOIS ENVIRONMENTAL
)
PROTECTION AGENCY,
)
)
Respondent.
MR. MICHAEL
E. STEIN APPEARED ON BEHALF OF PETITIONER.
MR. TODD RETTIG APPEARED ON BEHALF OF RESPONDENT.
OPINION AND ORDER OF THE BOARD
(by J.C. Marlin)
This matter is before the Board on a petition for review
(Pet.)
filed August
2,
1991 by petitioner Lawrence Cadillac
(Lawrence) pursuant to Section 22.18b(g)
of the Environmental
Protection Act
(Act)
(Ill.Rev.Stat.
1989,
ch.
111 1/2,
par.
1022.l8b(g))
Lawrence challenges the Illinois Environmental
Protection Agency’s (Agency) determination that Lawrence’s
application for reimbursement for corrective action costs from
the Underground Storage Tank
(UST)
Fund is subject to a $50,000
•deductible.
A hearing was held on October 18,
1991
in Chicago,
Illinois.
No members of the public attended and no witnesses were presented
by either side at hearing.
Petitioner filed is post-hearing
brief
(Pet.
Br.)
on November 25,
1991.
The Agency responded with
its brief
(Ag. Br.)
on December 9,
1991.
The petitioner filed a
reply brief on December 23,
1991.
The only issue in this case is whether Lawrence had actual
or constructive knowledge, prior to July 28,
1989,
that a release
from its USTs had occurred.
If Lawrence had such knowledge,
a
$50,000 deductible applies to its claim.
(I1l.Rev.Stat.,
1989,
ch.
111 1/2, par.
1022.l8b(d)(3)(c)(ii))
If Lawrence establishes
that it did not have actual or constructive knowledge before July
28,
1989,
a $10,000 deductible applies to its claim.
BACKGROUND
This case involves corrective action at property owned by
Lawrence located at 9601 Ogden Avenue, LaGrange,
Illinois.
The
USTs, ten in all, had been taken out of service in 1981 by the
owner.
In 1986 Lawrence purchased the property.
The tanks were
then removed by Lawrence in September 24,
1987.
(R.
8-17)
Though the UST Fund may reimburse owners and operators for
the costs of corrective action resulting from a release of
petroleum, Lawrence’s initial application dated April 26,
1991
stated that “none” of the tanks were presently leaking at the
130—49
2
site.
(See answer to question 7C, Pet.,
Exhibit B)1
The Agency
returned this application and requested clarification.
(Pet. Exh.
D)
Lawrence then refiled its application on May 22,
199-1.
(R.
6-19)
By letter dated June 3,
1991 the Agency returned the
application stating, among other things that the answer to
question 7C was unacceptable and that the Agency could not
determine whether the subject premises was eligible for
reimbursement given Lawrence’s response to the question.
Lawrence then amended its answer to question 7C to state that all
tanks were “presently” leaking.
When the Agency determined that~
a $50,000 deductible applied to this claim,
Lawrence appealed to
the Board.
DISCUSSION
Section 2218(d) (3)
(C)
(ii)
of the Act states:
It shall be the burden of the owner or operator to
prove to the satisfaction of the Agency that the owner
or operator had no actual or constructive knowledge
that the release for which a claim is submitted first
occurred prior to July 28, 1989~
At dispute for resolution at hearing was the Agency’s
contention that a $50,000 deductible applied.
The Agency’s
determination letter contends that the contamination exhibited in
soil samples taken at the site in 1991 must have occurred prior
to July 28,
1989 as the only known source of the contamination,
Lawrence’s USTs, were removed prior to that date.
(R.1,
29)
The petitioner argues that the evidence demonstrates
petitioner had no actual or constructive knowledge of a release
at the site prior to July 28,
1989.
(Pet. Br., p.3)
Lawrence
claims in its brief that it first became aware of a release on
the subject property on May 17,
1991 when a site investigation
revealed the contamination to the owner.
Lawrence also argues in
its brief that it amended its answer to question 7C of the
application because of its “belief that the tanks must have been
leaking at some point in the past” but that it did not know
exactly when.
(Pet.
Br., p.2,9)
Lawrence asserts that under
these facts,
a $10,000 deductible applies.
The Agency argues that petitioner did not carry his burden
of proof by simply applying for reimbursement.
(Ag. Br., p.2)
Lawrence, the Agency argues, submitted no evidence at hearing or
otherwise to show that the petitioner had no actual or
constructive knowledge that a release occurred prior to July 28,
1989.
The Agency asserts that the petitioner cannot rely on the
absence of facts in the record to meet its burden nor can it rely
on its arguments at hearing or in briefs to supply the requisite
This information is included for purposes of background.
The application and letter were not made part of the Record.
See
also fn 2.
130—50
3
showing.
(Ag.
Br.
p.
3)
Given the structure of the statute,
in a situation where an
application for determination of eligibility for corrective
action costs shows the removal of tanks at a site in 1987 and the
subsequent discovery of contamination at that site in 1991 the
Agency may validly infer that the contamination came from the
USTs.
We believe, that in the absence of evidence to the
contrary, the Agency could also validly infer that any release
occurred prior to July 28,
1989.
The applicant’s burden is to
establish that it did not have actual or constructive knowledge
of a release prior to July 28,
1989.
I1l.Rev.Stat.
1989,
ch.
111
1/2,
par.
1022.18(d)(3)(c)(ii)
The Board agrees with the Agency that the record is devoid
of any facts which indicate that the petitioner met its statutory
burden of proof.
No witnesses were provided at hearing by
petitioner relating to the issue.
The petitioner did not attempt
to introduce the May 1991 site audit or any evidence regarding
the tank removal in 1987.
The sole evidence,
in this case,
consists of the Agency Record, introduced as Joint Exhibit #1 at
hearing.
(TR.
18)2
The Board has not considered in its
deliberations of this case factual allegations introduced outside
the record such as in briefs or reply briefs.
Among these are
alleged facts concerning the circumstances surrounding the UST
removal and petitioner’s state of mind in answering certain
questions in the reimbursement application.
Under these
circumstances we cannot say that Lawrence met its burden of
proof.
The language of the statute is clear that it is the
applicant,
not the Agency, which must go forward with evidence
regarding absence of actual or constructive knowledge.
To rely
upon the absence of facts in the record to make petitioners case
would,
as the Agency argues, impermissably shift the burden of
proof.
We must conclude that where the petitioner fails to go
forward with its burden,
its case fails.
The case at hand is distinguishable from that in Beer
Motors.
Inc.
v.
IEPA,
PCB 91—120,
_____
PCB
____
(January 23,
1992)
where the issue of actual or constructive knowledge was
involved.
There the petitioner introduced evidence at hearing
which showed various possible causes for the soil contamination,
not all of them related to a release from a UST.
In that case
the Board decided that petitioner had rebutted the inference of
constructive or actual knowledge.
In the case at bar the
2
In cases which turn upon the applicant’s burden of proof,
we believe the better practice is to include all correspondence
between
the
applicant
and
the
Agency,
including
the
rejected
applications,
in the Agency Record.
We note,
however,
that the
applicant chose not to move to-supplement the record either before
or
at
hearing.
The
applications do
not
include
any
evidence
concerning
the
May
1991
site
investigation
or
the
1987 -tank
•removal.
We also note that the Agency
questionnaire does
not
readily lend itself to this fact situation.
130—5 1
4
petitioner introduced no evidence at all on the issue.
Finally, Lawrence argues that it was denied due process by
its inability to present evidence at hearing.
The hearing was
properly noticed and, at hearing, Lawrence gave no reason for
being unprepared to present witnesses or evidence.
Additionally,
we do not see where the petitioner either appealed the hearing
officer’s apparent decision to deny petitioner’s request for a
continuation of the hearing date nor do we see that petitioner
properly preserved any objection on this point at hearing.
We
believe,
therefore, that petitioner’s objection has been waived.
The Board also notes that it has decided to remand to the
Agency those Agency determinations of eligibility which did not
reach the issue of reimbursability of costs and deductibility.
In Ideal Heating v.
IEPA, PCB 91—253,
____
PCB
____
(January 23,
1992)
the Board held that such incomplete determinations are not
appealable.
The Board applies this principle only in cases where
no hearing has been held.
Because a hearing was held in this
case, the Board, therefore, has decided this case on the merits.
This opinion constitutes the Board’s findings of fact and
conclusions of law in this matter.
ORDER
The-Agency determination that a deductible of $50,000
applies is affirmed.
IT IS SO ORDERED.
Section 41 of the Environmental Protection Act
(Ill.Rev.Stat.
1989,
ch.
111 1/2, par.
1041) provides for the
appeal of final orders of the Board within 35 days.
The Rules of
the Supreme Court of Illinois establish filing requirements.
I, Dorothy N. Gunn,
Clerk of the Illinois Pollution Control
Board, hereby
cer~jfy
that the above~Opinionand Order was
adopted o
the
~ ~
day of
_________________,
1992, by a
vote of
______.
1/
I
~
~
-
‘Dorothy M. 9~nn,Clerk
Illinois Poflution Control Board
130—52