WASHINGTON, May 31, 2016 - In a decision that did not come as a surprise, the Supreme Court has ruled unanimously that landowners can challenge Army Corps of Engineers wetlands determinations in court (U.S. Army Corps of Engineers v. Hawkes Co.).

Three Minnesota peat mining companies that sought to expand their operations were stymied by a Corps jurisdictional determination (JD) that found wetlands on acreage targeted for expansion, even though the land was more than 100 miles from the nearest “navigable water.”

A U.S. District Court judge rejected the landowners’ legal challenge, finding that the JD was not “final agency action.” The 8th Circuit reversed, and the Supreme Court granted the government’s petition for review.

The American Farm Bureau Federation and National Cattlemen’s Beef Association, which filed a “friend of the court” brief backing the landowners, applauded the decision.

“This is wonderful news for farmers and ranchers, particularly under the threat of EPA’s and the Corps’ new ‘waters of the U.S.’ rule,” said Ellen Steen, AFBF general counsel.

And NCBA President Tracy Brunner said, "The ability to challenge a determination before going through the time consuming and costly permitting process or gambling on EPA enforcement provides a measure of fairness to landowners.

In a press release issued by the Pacific Legal Foundation, which represented the companies before the court, Kevin Pierce of Hawkes Co. said, “We are now guaranteed the right to appeal to the courts against the Corps’ jurisdictional wetlands’ decision, that doesn’t follow environmental policy or law, which harms our wetland dependent business.
The Corps had argued that the landowners did not have the right to go to court. They could, in the court’s words, “either discharge fill material without a permit, risking an EPA enforce­ment action during which they can argue that no permit was required, or apply for a permit and seek judicial re­view if dissatisfied with the results.”

But “neither alternative is adequate,” the court said. “As we have long held, parties need not await enforcement proceedings before challenging final agency action” if they are faced with serious criminal and civil penalties.

“If (the landowners) discharged fill material without a permit, in the mistaken belief that their property did not contain jurisdictional waters, they would expose themselves to civil penalties of up to $37,500 for each day they violated the (Clean Water) Act, to say nothing of poten­tial criminal liability,” the court said.

The court’s decision was not unexpected. At oral argument, most of the justices appeared to be skeptical of Deputy Solicitor General Malcolm Stewart's argument that a Corps JD is not final agency action but is merely an expression of the agency’s “opinion” of whether the property in question is a wetland and thus should be regulated under the Clean Water Act.

But an approved JD is clearly final action, the court found, noting that “it is issued after extensive factfinding by the Corps regarding the physical and hydro­logical characteristics of the property.”

“Indeed, the Corps itself describes approved JDs as ‘final agency action,’ and specifies that an approved JD ‘will remain valid for a period of five years,’ ” the court said in the opinion, written by Chief Justice John Roberts.

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Three separate concurrences followed the opinion. In the first, Justice Anthony Kennedy, joined by Justices Samuel Alito and Clarence Thomas, said the Clean Water Act (CWA) “continues to raise troubling questions regarding the government’s power to cast doubt on the full use and enjoyment of private property throughout the nation.”

Quoting Alito from an earlier opinion involving CWA enforcement, Kennedy said the CWA’s “reach is ‘notoriously unclear’ and the consequences to landowners even for inadvertent violations can be crushing. An approved (JD) gives a landowner at least some measure of predictability, so long as the agency’s declaration can be relied upon.”

Justices Ruth Bader Ginsburg and Elena Kagan wrote separate concurring opinions.


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