Appeal from the United States District Court for the Western District of Wisconsin. No. 77 C 407 -- Barbara B. Crabb, Judge.
Bauer, Circuit Judge, Pell, Senior Circuit Judge, and Dupree, Senior District Judge.*fn*
In 1978, pursuant to litigation commenced under the Clean Water Act (CWA), 33 U.S.C. § 1251 et seq. (1978), by the United States Army Corps of Engineers (Corps), defendants Roland G. Huebner, William Huebner and the Petenwell Potato Farms (Huebners), entered into a consent decree with the Corps regarding the maintenance of the wetlands on their property. In 1983, following a six-day hearing, the district court found the Huebners in contempt of the 1978 order and ordered them to comply with a restoration plan developed by the Corps. The Huebners appeal the lower court's contempt order and restoration plan. We affirm the district court's finding of contempt, reverse the district court's restoration order and remand with instructions.
In 1977, the Huebners, owners of a 4,000 acre vegetable farm, acquired "Bear Bluff Farms," a 5,000 acre property in Jackson County, Wisconsin, the largest continuous area of wetlands in Wisconsin. The wetlands on Bear Bluff provide a habitat for wetland foliage and wildlife, and moderate the flow of water to surrounding wildlife refuges by absorbing excess stream flow in periods of high water and releasing water during the dry season.*fn1
Since the turn of the century Bear Bluff has been used intermittently for a variety of agricultural purposes, including the production of dryland crops, such as corn and oats. For the twenty years preceding the Huebners' ownership, however, only cranberries have been grown on the land. Cranberry cultivation requires a constant supply of water to protect against frost, to flood the berries for harvesting, to mulch them in the winter and to irrigate them in the growing season.*fn2 When the Huebners acquired Bear Bluff, the farm included three cranberry beds, including a fifty-seven acre cranberry bed called the Staege bed on the southern part of the property. The Staege bed was served by three diked reservoirs: the Hunter's Peak, Juleane and Unnamed Reservoirs. The record indicates that the Huebners intended to expand the cranberry operations of Bear Bluff Farms and to use a portion of the farm for growing vegetables and other upland crops.
In 1977, the Huebners began to plow sections of the farm to clear out existing ditches and dig new ones. On September 2, 1977, the St. Paul District of the United States Army Crops [Corps] of Engineers issued several cease and desist orders to the Huebners, alleging that their ditching activities constituted a permitless "discharge of dredged or fill material" into the Bear Bluff wetlands in violation of section 301 of the Federal Water Pollution Control Act, 33 U.S.C. § 1311 (1976), renamed the "Clean Water Act" in 1977.*fn3 On November 10, 1977 the Corps filed a complaint in the district court seeking a permanent injunction and a financial penalty against the Huebners. In June, 1978 the parties settled the action by entering into a consent decree approved by District Judge James E. Doyle.
Paragraphs 1 and 2 of the ten paragraph order are most significant for purposes of this appeal. Paragraph 1 permanently enjoins the Huebners "from any and all operations which constitute the discharge of dredged or fill material into waters of the United States, including wetlands within the . . . described area of Jackson County, Wisconsin . . . except as in accordance with a Department of Army permit and other lawful authority." Paragraph 2 requires that the Huebners notify the Corps "in writing, twenty (20) days prior to the commencement of any discharge of dredged or fill material on any portion or portions of the land described in paragraph 1," so that the Corps could "notify the defendants, in writing, of the need for the Department of Army permit as to the stated sites."
Paragraphs 4, 5 and 7 relate principally to the restoration and continued maintenance of wetlands in the Hunters Peak, Juleane and Unnamed Reservoirs. Paragraphs 4 and 5 describe certain restoration and maintenance activities to be performed by the Huebners on culverts, embankments and ditches, which activities would restore the ditches and dikes to the dimensions existing prior to the dredging that prompted the order. Paragraph 7 requires the Huebners to "maintain and operate the control structures and reservoirs referred to in paragraph 4 above in a safe manner, for maximum drainage control, and to protect the integrity of the dikes and the structures therein."*fn4
The Huebners complied with the immediate restoration provisions of the consent order. On November 16, 1982, however, the government moved for an order to show cause why the Huebners should not be held in contempt for violating the 1978 order. The government, through its affidavits, charged that dredged material had been placed on the sides of Beaver Creek and was sliding into the adjacent wetlands, that a portion of the wetland had been plowed and furrowed by a marsh plow, and that the dikes of the Hunter's Peak, Julane [Juleane] and Unnamed Reservoirs had been leveled and scraped by a bulldozer without notice to the Corps and without any Corps permit allowing such activity. The Huebners had planted barley in a plowed portion of the Hunter's Peak, and stated that they intended to plant corn.*fn5
The district court adopted the government's "proposed finding of fact" as "preliminary findings of fact" on January 17, 1983, and held evidentiary hearings for six days, in April and May of 1983. On August 4, 1983 the district court entered an order holding the Huebners in civil contempt of the court's 1978 consent order on the grounds that the government had proved by "clear and convincing evidence" that the Huebners had made permitless discharges of dredged and fill material into the Bear Bluff wetlands in violation of the 1978 order. The Huebners allege that they are not in contempt of the district court's 1978 order because the activities in which they engaged in on their land did not require a Corps permit. They allege that the district court erred in its interpretation of the agricultural exemptions of the CWA, as relevant to the 1978 consent order, in determining when permits are required. The Huebners also argue that the district court denied them due process by improperly excluding certain evidence during the contempt hearing, and that the court abused its discretion in refusing to amend the 1983 restoration plan.
Congress enacted the CWA "to restore and maintain the chemical, physical and biological integrity of the Nation's waters." 33 U.S.C. § 1251(a) (1978). The goal of the CWA is to eliminate by 1985 "the discharge of pollutants into navigable waters." 33 U.S.C. § 1251(a)(1) (1978).
The "navigable waters" subject to Corps authority under the Act include wetlands, which have been defined as
those areas that are inundated or saturated by surface or ground water at a frequency and duration sufficient to support, and that under normal circumstances do support, a prevalence of vegetation typically adapted for life in saturated soil conditions. Wetlands generally include swamps, marshes, bogs and similar areas.
33 C.F.R. § 323.2(a)(7)(c) (1983). The term "navigable waters" has been given "the broadest constitutional interpretation," 1 LEGISLATIVE HISTORY at 178 (Senate Consideration of the Conference Report on S. 2770, Oct. 4, 1972), in recognition of the fact that
the regulation of activities that cause water pollution . . . must focus on all waters that together form the entire aquatic system. Water moves in hydrologic cycles, and the pollution of [a] part of the aquatic system . . . will affect the ...