CADDNAR
[CITE: Town of Long Beach, et al. v. DNR, et al., 15 CADDNAR 101 (2020)]
Cause #: 18-047W
Caption: Town of Long Beach and Alliance for the Great Lakes and Save the Dunes v. DNR Stokes Fitzgerald LLC and Greg Kuzmic
Administrative Law Judge: D. Wilson
Attorneys: C. Willoughby for Petitioner Town of Long Beach; J. Hyman for Intervenor Alliance for the Great Lakes and Save the Dunes; R. McClain for Respondent DNR; G. Kuzmic for Respondent Stokes Fitzgerald LLC
Date: June 26, 2020
[Editor’s Note: Final Order follows Findings of Fact and Conclusions of Law.]
FINDINGS OF FACT AND CONCLUSION OF LAW
WITH FINAL ORDER ON MOTION FOR SUMMARY JUDGMENT
1. The Town of Long Beach (“Long Beach”) initiated this proceeding by filing a “Petition for Administrative Review” (the “Petition”) on May 25, 2018. The Petition avers that the basis for the Department of Natural Resources’ (“Department”) termination of permit application LM-215 was in contravention of applicable federal, state and local laws and/or regulations. In addition, the Petition states that Long Beach was aggrieved and/or adversely affected by the Department’s termination order due to the impact the determination could have that “gravely impacts Long Beach’s ability to effectively and adequately manage and enforce its ordinances and hinders other necessary public policy decisions regarding issues along the Lake Michigan shoreline over which the DNR and Long Beach both have jurisdiction.” Petition.
2. The Petition initiated a proceeding that is governed by IC 4-21.5 (sometimes referred to as the “Administrative Orders and Procedures Act” or “AOPA”) and rules adopted by the Natural Resources Commission (“Commission”) at 312 IAC 3-1 to assist with its implementation of AOPA.
3. Administrative Law Judge Sandra Jensen was appointed under IC 14-10-2-2 to conduct this proceeding.
4. The Department, pursuant to 312 IAC 3-1-8, filed a “Motion for Automatic Change of Judge” and Dawn Wilson was appointed as Special Administrative Law Judge (“ALJ”) in this proceeding.
5. On January 7, 2019, the Department filed a “Motion to Dismiss” the proceeding. The Department asserted that the Petition failed to qualify as a request for a quasi-declaratory judgment because the Petition failed to fulfill the requirements of 312 IAC 3-1-15. The Department also asserted that the termination was a Department determination to take no action, and that it was not a grant, renewal, transfer, or denial of a license, as required by IC 4-21.5-3-5(a)(1). Lastly, the Department asserted that Long Beach was not aggrieved or adversely affected by the Termination in that the determination would not interfere with the authority of Long Beach to exercise its powers.
6. Following response and reply by the parties, on June 14, 2019, the ALJ issued an “Order on Motion to Dismiss” denying the Department’s motion.
7. Upon a petition to intervene by Alliance for the Great Lakes and Save the Dunes (“Alliance-Dunes”), and following the Department’s response filed on April 10, 2019, The ALJ issued an “Order on Alliance-Dunes’ Petition to Intervene” granting intervention by Alliance-Dunes.
8. On September 5, 2019, Alliance-Dunes filed a “Motion for Summary Judgment by Alliance for the Great Lakes and Save the Dunes” (“MSJ”). Alliance-Dunes asserts in its MSJ that the “Termination Order…constitutes unlawful abdication of the agency’s authority, jurisdiction, and duty, is an incorrect statement of jurisdiction, is contrary to law, and is thus void.” MSJ at p 2.
9. On December 19, 2019, the Department filed its “Response to Motion for Summary Judgment/Motion to Dismiss” (“Response”). In its Response, the Department asserts that after, and in response to a decision by the Indiana Supreme Court in Gunderson v State of Indiana and the Ind. Dep’t of Nat. Resources, 90 N.E.3d 1171 (Ind. 2018), the Department published an emergency rule to supersede 312 IAC 1-1-26. The Department also asserted that the “sole” issue presented in this proceeding is moot because “any relief that could be provided by the [ALJ] has already been provided.” In support, the Department acknowledged its authority upon land within the public trust, and asserted that the change in the Department’s determination, as evidenced by the emergency rule, concerning its regulatory authority provided the relief sought by the Intervenors. In addition, the Department, in reliance on the Department’s software limitations to allow additional action on a terminated application, supported its position by stating the Department had informed Kuzmic, LM-215’s applicant, that a new application could be submitted.
10. On December 19, 2019, the Department also filed a “Motion to Strike” three exhibits submitted by Alliance-Dunes as MSJ support.
11. On January 9, 2020, Alliance-Dunes filed its “Combined Reply to Opposition on Motion for Summary Judgment and Response to Motion to Strike by Alliance for the Great Lakes and Save the Dunes” (“Reply”).
12. On January 17, 2020, the ALJ granted the Department’s Motion to Strike, in part.
13. The Reply filed by Alliance-Dunes asserts that the outstanding disputed issues are not moot because the legal basis originally asserted by the Department in its termination order was unlawful. Alliance-Dunes argues that, even if the Department’s actions, including the adoption of an emergency rule to supersede 312 IAC 1-1-26, render the case moot, a public interest exception should be applied to the issues asserted in its MSJ.
14. On April 27, 2020, the Petitioner, by counsel, filed a “Motion to Dismiss by the Town of Long Beach”. By order dated April 27, 2020, Long Beach was dismissed from this proceeding. Currently, the Intervenor, Alliance-Dunes, and the following Respondents remain as parties to this proceeding, the Department, Stokes Fitzgerald LLC and Greg Kuzmic.
15. The Commission is the “ultimate authority” for determinations under the Navigable Waterways Act and has adopted rules at 312 IAC 6 to assist with its administration. IC 4-21.5-1-15 and 312 IAC 3-1-2.
16. The Commission possesses jurisdiction over the subject matter and the persons of the parties.
17. The matter is ripe for a determination for the issue presented on summary judgment.
Summary Judgment Standard
18. Pursuant to IC 4-21.5-3-23 the Commission considers summary judgment in the manner prescribed by Trial Rule 56 of the Indiana Rules of Trial Procedure.
19. Trial Rule 56(C) provides that “the judgment sought shall be rendered forthwith if the designated evidentiary matter shows that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.”
20. "A fact is ‘material’ if its resolution would affect the outcome of the case, and an issue is ‘genuine’ if a trier of fact is required to resolve the parties' differing accounts of the truth ..., or if the undisputed facts support conflicting reasonable inferences." Angel v. Powelson, 977 NE 2d 434 (Ind. Ct. App. 2012) citing Williams v. Tharp, 914 N.E.2d 756, 761 (Ind. 2009).
21. “The purpose of summary judgment is to terminate litigation about which there can be no factual dispute and which may be determined as a matter of law.” Bragg v. Kittle's Home Furnishings, Inc., 52 N.E.3d 908, 919 (Ind. App. 2016).
22. “When any party has moved for summary judgment, the court may grant summary judgment for any other party upon the issues raised by the motion although no motion for summary judgment is filed by such party.” Indiana Rules of Trial Procedure, Trial Rule 56(B).
23. The Commission is obligated to designate the issues or claims presented on summary judgment upon which it concludes there to be no genuine issue as to any material facts. Indiana Trial Rule 56(C).
[VOLUME 15, PAGE 102]
Findings of Fact Relevant to Issue Presented on Summary Judgment
24. The facts presented in this case are largely undisputed.
25. A permit application was filed with the Department by Stokes Fitzgerald LLC and Greg Kuzmic. The application was identified as LM-215. MSJ, Exhibit 1.
26. The project proposed by LM-215 was for construction at 2214 Lakeshore Drive at Long Beach. Id.
27. The construction project proposed by LM-215 was described as follows: “Stone toe protection will be placed along an existing 120' steel sheet pile seawall. The toe protection will consist of approximately 103 tons of armor stone revetment placed on top pf 4″ – 8″ layer of aggregate stone. Geotextile filter fabric will be placed under the stone. The revetment will be 6' high and extend 12' out into Lake Michigan at a 2:1 slope.” Id.
28. A decision by the Indiana Supreme court in Gunderson v State of Indiana and the Ind. Dep’t of Nat. Resources, 90 N.E.3d 1171 (Ind. 2018) was filed on February 14, 2018.
29. The Department terminated permit application LM-215 on May 7, 2018.
30. The following formed the basis for the Department’s termination of LM-215 as stated in its termination notice, “…the toe protection will be above Lake Michigan’s ordinary high water mark of 581.5’, IGLD 85; therefore, a permit under the Navigable Waters Act, IC 14-29-1 is not required.” Id.
31. Emergency Rule, LSA Document #19-491(E), was published in the Indiana Register at DIN: 20190918-IR-312190491ERA. LSA Document #19-491(E) supersedes the definition of “Ordinary High Watermark” in 312 IAC 1-1-26 by, “…removing subdivision (2), which sets the shore of Lake Michigan at five hundred eighty-one and five-tenths (581.5) feet I.G.L.D. 1985, from the definition of ‘ordinary high watermark.” The Emergency Rule was effective on the date filed it was with the publisher, September 16, 2019, and is currently effective.
32. The Emergency Rule was not effective on the date the Department terminated permit application LM-215.
33. The applicant for LM-215 was notified that another permit application could be submitted for review under the recently adopted Emergency Rule.[1]
Issues presented on Motion for Summary Judgment
34. Alliance-Dunes presents the following issues for consideration on summary judgment. The issues, upon which there to be no genuine issue as to any material facts, are restated as follows:
a. Is the Department’s termination of Permit application LM-215 contrary to law and void?
b. Did the Department’s authority extend to the regulation of construction activities below the natural OHWM at the Lake Michigan shore?
c. Does the Department have a duty to assess threats and protect public trust resources and rights?
Conclusions of Law Relevant to Issues on Summary Judgment
Is the Department’s termination of Permit application LM-215 contrary to law and void?
35. Lake Michigan is subject to IC 14-29-1 (sometimes referred to as the “Navigable Waterways Act”) and the administrative rules adopted to implement IC 14-29, at 312 IAC 6.
36. The Navigable Waterways Act, in part, specifies, “A person, other than a public or municipal water utility, may not: (1) place, fill, or erect a permanent structure in; (2) remove water from; or (3) remove material from; a navigable waterway without a permit from the department.” IC 14-29-1-8(a).
37. Relevant to IC 14-29, the Commission is the “ultimate authority” of the Department. IC 4-21.5-3-15; IC 14-10-2-3.
38. As the Department’s “ultimate authority”, the Commission must properly conduct this proceeding de novo. Rather than deferring to a Department permitting determination, de novo review requires the Commission to consider and apply proper weight to the evidence.” Daniel v. Johnston & Fultz Excavating), 12 CADDNAR 317, 318, (2011), internal citations omitted.
39. The Department terminated a permit application that proposed a construction project at the shoreline of Lake Michigan, LM-215. After the termination, the Department’s legal positon changed regarding the basis of the termination, as stated in its termination notice.
40. The basis for LM-215’s termination is not consistent with the current position of the Department. The Department’s current legal positon is evidenced by adoption of the Emergency Rule that supersedes 312 IAC 1-1-26.
41. Alliance-Dunes asserts that LM-215’s termination notice has not been repealed, rescinded, reversed or voided and remains as an existing Department order.
42. However, the Department, asserted in its Response the following:
…Intervenors argue that the Department should have determined the boundary of its regulatory authority from the location of the OHWM as determined by the ‘physical characteristics” analysis of 312 IAC 1-1-126(b)(1). The Department, through a change in course, has agreed. As evidenced by the change in 312 IAC 1-1-26 as well as other action taken by the Department, it is clear the bounds of the Department’s regulatory authority for Lake Michigan is determined by the physical characteristics test. Therefore, the relief requested has already been granted.
Response, p 4.
43. Technology limitations of the Department resulted in the Department advising the applicant to reapply for construction at the location originally proposed by LM-215. The new permit application is identified as LM-226. The Department’s inability in its existing system to alter the designation of an application after it has been terminated in the system is regretful.
44. Alliance-Dunes, on April 1, 2020, filed a “Status Report of April 24, 2020 by Alliance for the Great Lakes and Save the Dunes” (“Status Report”). On page 2 of the report, Alliance-Dunes reports that the applicant submitted a second permit application, LM-226, and that the second application was denied.
45. LM-226 proposed construction at 2214 Lake Shore Drive at Long Beach for “Limestone boulders varying in size will be placed in front of an existing steel seawall. Geotextile fabric will be placed under the boulders. The rocks will be 8' high at the face of the existing steel sheet pile seawall and slope down to meet the existing grade at a distance of 16' from the existing seawall.” Status Report, Exhibit 2.
46. Permit application LM-226 was denied by the Department for the following stated reason, “The Department has determined that the project would unreasonably impede the public trust.” Status Report, Exhibit 2.
47. The termination order has been practically reversed by the Department, in a way that is limited by the Department’s current permitting system’s technology.
48. An issue is deemed moot when “no effective relief can be rendered to the parties.” Anderson v Huntington County. Bd. of Com’rs, 983 N.E.2d 613, 617 (Ind. App. 2013). In addition, an issue is moot when “the concrete issue in a case has been ended or settled or in some manner disposed of, so as to render it unnecessary to decide the question involved.” Indiana Gas Co. v Indiana Fin. Auth., 999 N.E. 2d 63, 67 (Ind 2013).
49. When it becomes unnecessary to decide the question presented, the appropriate practice is to dismiss the case. Haggerty v Bloomington Bd. of Public Safety, 474 N.E.2d 114, 116 (Ind App 1985).
50. Alliance-Dunes asserts that an issue is moot when “it is no longer live, when the parties lack a reasonable cognizable interest in the outcome, or when we are unable to provide effective relief upon the issue.” Irwin R. Evans & Son, Inc. v Board of Indianapolis Airport Authority, 584 N.E.2d 576, 581 (Ind. App. 1992).
51. In this proceeding, the termination of Permit application LM-215 has been reconsidered by the Department, as presented by LM-226, and has now been denied, not terminated. No administrative review of the Department’s denial of LM-226 was filed with the Commission and the construction project anticipated by LM-215 is no longer live.
52. As to Permit Application LM-215, there is no further issue of law to be determined concerning the termination of LM-215.
53. The outstanding disputed issues in this case are now moot.
54. As requested by the Department, and for the reasons stated above, dismissal of this proceeding is appropriate.
55. Summary judgment for the Department is granted with respect to this issue.
Did the Department’s authority extend to regulation of construction activities below the natural OHWM at the Lake Michigan shore? Does the Department have a duty to assess threats and protect public trust resources and rights?
56. Alliance Dunes suggests, even if the issues in this proceeding are determined to be moot, that issues unrelated to the specific permit application in this case should still be decided.
57. In its Argument filed to support its MSJ, Alliance-Dunes asserts that “generally cases which fall within the public interest exception are those cases which contain issues which are likely to reoccur.” Reply at p 11, citing Irwin R. Evens & Son, 584 N.E.2d at 581 (Ind. App. 1992).
58. The issues presented by Long Beach in its Petition do not extend to some of the claims presented by Alliance-Dunes in its MSJ. Alliance-Dunes did not seek to file any cross petition or counterclaim in this proceeding and it is now limited by the claims identified in the Petition. Unlike Alliance-Dunes, Long Beach, in its Petition, relied upon the need to establish jurisdiction boundaries between it and the Department and the need to adequately manage and inforce its ordinances. The sole issue presented by Long Beach that is also claimed by Alliance-Dunes is that the basis of the Department’s determination to terminate the permit application is contrary to law. See the Petition and the MSJ.
59. Subsequent to the Department’s termination of LM-215, the Department altered its position regarding its jurisdiction. The Department’s departure from its previously held position, is supported by the Department’s statements within its Response and by the adoption of an Emergency Rule. Due to the Department’s change in course, the basis for the Department’s termination of LM-215 is no longer presented as a disputed issue.
60. In addition, the Department was receptive to consideration of a new application, LM-226, proposed by the same applicant, for a similar project at the same location as LM-215. In that LM-226 was denied and the Department “determined that the project would unreasonable impede the public trust”, termination is not likely to reoccur. Status Report, Exhibit 2.
61. The issues presented in the termination of Permit Application LM-215, are not likely to reoccur and, for that reason, do not fall within a public interest exception.
62. Summary Judgment must properly be granted in favor of the Department.
FINAL ORDER ON MOTION FOR SUMMARY JUDGMENT
Summary Judgment having been granted in favor of the Department of Natural Resources and against Alliance for the Great Lakes and Save the Dunes, and it having been determined further that no dispute exists on the material facts, the instant proceeding is hereby dismissed.
[1] On page 4 of the Department’s Response, the following footnote appears, “Once the application was ‘terminated’ as occurred here, the Department’s permit-generating software (‘Unity’) does not allow additional action to be taken with respect to the terminated application. A new application must therefore be filed.”