In Re the Petition of Halberg Construction & Supply, Inc.

385 N.W.2d 381, 1986 Minn. App. LEXIS 4254
CourtCourt of Appeals of Minnesota
DecidedApril 22, 1986
DocketC2-85-2075
StatusPublished
Cited by4 cases

This text of 385 N.W.2d 381 (In Re the Petition of Halberg Construction & Supply, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re the Petition of Halberg Construction & Supply, Inc., 385 N.W.2d 381, 1986 Minn. App. LEXIS 4254 (Mich. Ct. App. 1986).

Opinion

OPINION

POPOVICH, Chief Judge!

This appeal is from an order of respondent Minnesota Transportation Regulation Board denying relator’s petition for clarification of an irregular route common carrier permit. Relator contends the Board’s failure to apply equitable estoppel was an error of law. We reverse and remand.

FACTS

Relator Halberg Construction & Supply, Inc. obtained IRCC Permit No. 27957 in 1971 when it purchased Kirscher Bulk Transport. Kirscher originally held a state-wide permit to transport general commodities. The Public Service Commission notified Kirscher Transport, the seller, that, subsequent to transfer, the permit would be limited to:

heavy equipment, steel, lumber, building materials, cement, salt, scaffolding, lime, coal, bentonite and silica sand, in truck load lots from points in St. Louis, Kooc-hiching, Itasca, Carlton, Cass, Cook, and Lake Counties to other points in the state and from other points in the state to points in said Counties; also, between points in said Counties.

Relator, as purchaser, never received a copy of the order limiting the geographic scope of the transferred permit and was not informed of the limited permit. Its purchase price was based on state-wide authority.

Relator has operated as a state-wide carrier of heavy equipment since 1971 and owns a variety of specialized equipment used to haul overweight and oversize loads. A decline in economic conditions on the Iron Range forced relator to expand its operations elsewhere. By 1984, relator did 35 to 40 percent of its business outside the northeastern seven county area.

The Department of Transportation (Department) audited relator ten or eleven times in the period from 1971 to 1984. During the same period, the Department also issued numerous special permits to relator for hauling oversize or overweight loads. Each permit application showed the origin and destination outside the authorized geographic area. Relator’s trucks were frequently stopped at the Department’s weigh stations. Freight bills, log books, and special permit applications indicated relator was operating beyond its geographic authority but the Department took no action.

At oral argument, the court was informed that during the same period of time, relator appeared as a protestant in numerous hearings where others sought geographic authority. Relator always indicated its state-wide authority. Without such authority, relator faces bankruptcy.

Then in 1984, relator was cited for operating outside its permit authority and geographic area. Relator, following a suggestion by the Transportation Regulation Board, filed a “petition for clarification of the geographic scope” of its permit. The Board prepared and published notice of relator’s petition. The Department intervened, and the matter was heard as a contested case by the Office of Administrative Hearings.

The Administrative Law Judge (AU) found relator never received the Commission’s 1971 order limiting the permit and did not learn of the geographic limitations from any other source. The AU also found that documents available to the Department indicated relator exceeded the scope of its permit but the Department was “silent” about relator’s operations. The AU concluded that: (1) in 1971 the Commission could only transfer the limited permit relator had actually received; (2) the Board could not later expand the scope of the permit based on a showing that relator’s operations had exceeded the scope of its permit; (3) the Department was not estopped from asserting relator was operating in violation of its permit; and (4) the notice of relator’s petition was insufficient *383 to notify other interested parties it sought state-wide authority.

Thé AU recommended relator’s petition be denied. By order of October 16, 1985 the Board adopted the ALJ’s report and denied relator’s petition.

ISSUE

Whether the Board’s failure to apply equitable estoppel was an error of law?

ANALYSIS

1. The standard for review of administrative agency decisions is governed by the Minnesota Administrative Procedure Act, Minn.Stat. ch. 14 (1984), which provides:

In a judicial review under sections 14.-63 to 14.68, the court may affirm the decision of the agency or remand the case for further proceedings; or it may reverse or modify the decision if the substantial rights of the petitioners may have been prejudiced because the administrative finding, inferences, conclusion, or decisions are:
s*s * * He * *
(d) Affected by other error of law * *.

Id. § 14.69. A reviewing court gives no deference to an agency’s decision on a question of law. Beaty v. Minnesota Board of Teaching, 354 N.W.2d 466, 470 (Minn.Ct.App.1984) (citing Ekstedt v. Village of New Hope, 292 Minn. 152, 164, 193 N.W.2d 821, 829 (1972)).

2. We must determine whether the Board’s failure to apply the doctrine of equitable estoppel was an error of law. In Brown v. Minnesota Department of Public Welfare, 368 N.W.2d 906 (Minn.1985), the Minnesota Supreme Court described es-toppel as:

an equitable doctrine addressed to the discretion of the court and * * * intended to prevent a party from taking unconscionable advantage of his own wrong by asserting his strict legal rights. To establish a claim of estop-pel, plaintiff must prove that defendant made representations or inducements, upon which plaintiff reasonably relied, and that plaintiff will be harmed if the claim of estoppel is not allowed.
Northern Petrochemical Co. v. United States Fire Insurance Co., 277 N.W.2d 408, 410 (Minn.1979). The government may be estopped if justice requires, but this court has said that it does not “envision that estoppel will be freely applied against the government.” To estop a government agency, some element of fault or wrongful conduct must be shown. A plaintiff seeking to estop a government agency has a heavy burden of proof. When deciding whether estop-pel will be applied against the government, the court will weigh the public interest frustrated by the estoppel against the equities of the case.

Id. at 910 (citations omitted).

In Beaty, a teacher sought to estop the Minnesota Board of Teaching from denying her application for licensure as a school psychologist. 354 N.W.2d at 471. She had relied on representations by the Board and the Department of Education as to the educational requirements for the license and expended “a great deal of time and money” completing the requirements. Id. This court held the Board of Teaching erred in not applying equitable estoppel because:

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Bluebook (online)
385 N.W.2d 381, 1986 Minn. App. LEXIS 4254, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-petition-of-halberg-construction-supply-inc-minnctapp-1986.