Kirwen v. Petroleum Underground Storage Tank Release Compensation Board

642 N.E.2d 432, 95 Ohio App. 3d 323, 1994 Ohio App. LEXIS 2773
CourtOhio Court of Appeals
DecidedJune 30, 1994
DocketNo. S-93-33.
StatusPublished
Cited by4 cases

This text of 642 N.E.2d 432 (Kirwen v. Petroleum Underground Storage Tank Release Compensation Board) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kirwen v. Petroleum Underground Storage Tank Release Compensation Board, 642 N.E.2d 432, 95 Ohio App. 3d 323, 1994 Ohio App. LEXIS 2773 (Ohio Ct. App. 1994).

Opinion

Ajbood, Presiding Judge.

This is an appeal from a judgment of the Sandusky County Court of Common Pleas which reversed the finding of the Ohio Petroleum Underground Storage Tank Release Compensation Board (“board”) and found that appellant is eligible to participate in the financial assurance fund for the 1989 program year. The board has appealed setting forth the following assignments of error:

“I. The trial court improperly held that, by not promulgating a rule concerning the extension cut-off date, the board violated appellee’s due process rights.

“A. Due process rights were not violated since appellee had no right or entitlement beyond those which the legislation offered.

“B. Even if appellee had a property right to the extension, a procedural due process violation does not exist since he (appellee) could have protected the right.

“II. The denial of fund eligibility to owners or operators who did not pay fees prior to the extension cut-off date does not violate equal protection since such a policy does not create a suspect class and bears a rational basis to a legitimate government objective.”

The undisputed facts giving rise to this appeal are as follows. Effective July 11, 1989, R.C. 3737.90 to 3737.99 were enacted to create the Ohio Petroleum Underground Storage Tank Release Financial Assurance Fund (“fund”). The purpose of the legislation was to provide insurance coverage for the costs of corrective action and compensation for third parties for injury and damage associated with the accidental release of petroleum from underground storage tanks. See R.C. 3737.92(B). R.C. 3737.90 establishes the board to administer this fund and delineates its functions and authority.

*325 For the purpose of financing the fund, R.C. 3737.91(B) provides that a mandatory annual fee is to be “assessed * * * on each tank comprising an underground petroleum storage tank or an underground storage tank system that contains or has contained petroleum and for which a responsible person is required to demonstrate financial responsibility by rules adopted by the fire marshal under division (B) of section 3737.882 of the Revised Code.”

Although R.C. 3737.91(B) establishes a due date of July 1 of each year for payment of the annual fee, it also provided that for the first program year, July 1989 to July 1990, the payment due date would be October 9, 1989.

R.C. 3737.91(D) goes on to state that:

“(1) The board shall issue a certificate of coverage to any responsible person who has complied with both of the following:

“(a) Paid the fee assessed under division (B) or (F) of this section;

“(b) Demonstrated to the board financial responsibility in compliance with the rules adopted by the fire marshal under division (B) of section 3737.882 of the Revised Code for the deductible amount established under division (E) of this section or, when appropriate, the reduced deductible amount established under division (F) of this section.”

R.C. 3737.92 governs reimbursement to responsible parties under the fund and provides in pertinent part:

“(D) A responsible person is not eligible to receive payment or reimbursement from the fund under division (B) or (C) of this section unless all of the following conditions are met:

“(1) At the time that the release was first suspected or confirmed, a responsible person possessed a valid certificate of coverage issued by the board under division (D) of section 3737.91 of the Revised Code for the petroleum underground storage tank system from which the release occurred;

“(2) One of the following applies:

“ (a) The petroleum underground storage tank system from which the release occurred was registered in compliance with rules adopted by the fire marshal under section 3737.88 of the Revised Code * * *.”

Upon implementation of the program, the board, in an attempt to gain widespread compliance with the new law, extended the October 1989 deadline for payment of the 1989 program year fee and the July 1, 1990 deadline for payment of the 1990 program year fee and established December 15,1990 as the final date for payment of the fees for eligibility for the 1989 and 1990 program years. In deciding to waive the statutory deadlines, the board in effect provided retroactive *326 coverage for the first two program years as long as payment of the fees was made by December 15, 1990.

In order to notify noncomplying owners and operators of this extension the board cross-referenced a list of underground storage tanks that had been registered with the State Fire Marshal’s Office as required by law, against its list of complying tank owners. The board then sent out notices by certified mail that informed these owners or operators of the new law and its requirements.

The particular facts that were before the trial court as to appellee Kirwen are as follows. In 1958 Kirwen purchased property on which there was an underground petroleum storage tank. He used the tank until August 15, 1989, when a neighboring resident complained of gasoline in his well water. An investigation was conducted by local and state fire authorities, who concluded that Kirwen’s tank might be the source of the contamination. In September 1989 Kirwen had the tank removed. In February 1992 Kirwen became aware of the fund and the program and on February 24, 1992, he paid his fees for the 1989 and 1990 program years.

On April 6, 1992, Kirwen filed an application for corrective action costs associated with the 1989 release. On June 4, 1992, the board’s executive director issued his determination in which he denied coverage, stating that Kirwen had not made timely payment to the fund for the 1989 program year, the year of the release, and that at the time the release was first suspected or confirmed, his tank was not registered with the State Fire Marshal. On June 10, 1992, appellee appealed the director’s decision to the board and requested an administrative hearing. On January 12, 1993, a hearing was held pursuant to R.C. 119.09, 3737.91 and 3737.92. On January 14, 1992, the hearing examiner issued his report and recommendation in which he found the director’s determination to be reasonable and lawful and supported by reliable, probative and substantial evidence. Appellee filed objections to the report and recommendation with the board and on April 20, 1993 the board issued its order in which it adopted the hearing examiner’s report in its entirety. Appellee then filed a timely notice of appeal in the Sandusky County Court of Common Pleas. On August 19, 1993, that court issued its judgment entry in which it found that the decision of the board in November 1990 to accept no further fee payments for the program years 1989 and 1990 after December 15, 1990 constituted the promulgation of a rule, and therefore the procedure set forth in R.C. 119.03 should have been followed by the board; that, since R.C. 119.03 was not followed, the “rule” violated Kirwen’s basic due process rights, since he was not provided the opportunity of notice or a hearing; and that the circumstances raised equal protection arguments, since owners of registered underground tanks were notified by certified mail, whereas others received no public notice as contemplated by R.C. 119.03.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
642 N.E.2d 432, 95 Ohio App. 3d 323, 1994 Ohio App. LEXIS 2773, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kirwen-v-petroleum-underground-storage-tank-release-compensation-board-ohioctapp-1994.