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Chemetco, Inc. v. Pollution Control Board

OPINION FILED JANUARY 14, 1986.

CHEMETCO, INC., APPLICANT AND RESPONDENT-APPELLEE,

v.

THE POLLUTION CONTROL BOARD ET AL., RESPONDENTS (THE ENVIRONMENTAL PROTECTION AGENCY, COMPLAINANT-APPELLANT).



Petition for review of order of Pollution Control Board.

JUSTICE WELCH DELIVERED THE OPINION OF THE COURT:

This action involves an interlocutory appeal by the Illinois Environmental Protection Agency (hereinafter the Agency) and Chemetco, Inc., from an order of the Pollution Control Board (hereinafter the Board) entered February 20, 1985, rejecting a settlement agreement submitted by the Agency and Chemetco in an enforcement action under the Illinois Environmental Protection Act (Ill. Rev. Stat. 1983, ch. 111 1/2, par. 1001 et seq.) (hereinafter the Act). We granted leave to appeal pursuant to Supreme Court Rule 308 (87 Ill.2d R. 308). In its rejection of the settlement agreement, the Board certified the following question for interlocutory appeal:

"Whether the Board correctly determined it lacks statutory authority, pursuant to Ill. Rev. Stat. ch. 111 1/2, section 1032, 1033, and 1042, as they relate to Board acceptance of the stipulation of fact and proposals for settlement in enforcement cases to issue opinions and orders in which any Board findings of violation are precluded by the terms of the stipulation and proposal, but in which respondent is ordered to pay a stipulated penalty and to timely perform agreed upon compliance activities."

The facts are as follows:

On January 6, 1983, the Agency filed a complaint with the Board against Chemetco.

On March 7, 1983, the parties submitted a stipulation and proposal for settlement to the Board after a public hearing had been held on March 4, 1983, to solicit comments from the public on the proposed agreement as required by the Act. (A second stipulation and proposal for settlement was submitted on April 12, 1983, with several minor language changes). The initial settlement agreement provided that although the parties could not agree on whether Chemetco committed the violation, the parties would forego resolution of those issues in the interest of avoiding the expense and uncertainties of litigation, and Chemetco would institute a compliance plan to impose the control of emissions from the facility. Additionally, they would pay a $20,000 penalty to the Environmental Protection Trust Fund.

On October 6, 1983, the Board issued an interim order rejecting the settlement agreement. The grounds for rejecting it were that imposition of the $20,000 stipulated penalty "appears inappropriate under the Act in light of the Board's inability to find violations since (a) the Agency has not withdrawn any of the charges or allegations made in Counts I, II, III, and IV of the January 6, 1983, complaint; and (b) the respondent, although agreeing to the imposition of a penalty, has nonetheless steadfastly denied that any violation occurred * * *."

The Board then remanded the cause to the parties.

The parties on March 28, 1984, submitted a joint motion for approval of an amended settlement agreement and the amended settlement agreement. The joint motion noted that neither the Act, the Board's procedural rules, nor the Board's air pollution rules require a respondent to admit alleged violations in order to settle an enforcement case. The joint motion pointed out that previously the Board accepted settlement agreements in other enforcement actions where the respondent agreed to pay a penalty without admitting it had committed the violation alleged by the Agency. The amended settlement agreement substituted a statement that Chemetco neither admitted nor denied the violation in lieu of Chemetco's denial of violation and was also revised to reflect that the proposed compliance plan had been completed. A public hearing was again held on April 6, 1984.

On June 14, 1984, the Board issued an order approving the amended settlement agreement but included a finding that Chemetco had violated Air Pollution Rules 102, 103(b), 203(a), and 203(f)(1) (now 35 Ill. Adm. Code, secs. 201.141, 201.144, 212.321, and 212.301, respectively), and sections 9(a) and 9(b) of the Act (Ill. Rev. Stat. 1983, ch. 111 1/2, pars. 1009(a), (b)). Both parties objected to the inclusion of this finding and moved the Board to modify its order by deleting that finding.

The Board then issued an order that rejected the amended settlement agreement in its entirety. The Board held that its authority to order payment of a penalty and/or implementation of a compliance plan is premised on a finding of violation.

Both parties filed applications for interlocutory appeal, which were granted by this court on April 9, 1984.

• 1 We must first determine the appropriate standard of judicial review to apply in the case at hand by examining the Board's decision. It appears the Board's rejection of the settlement agreement was made solely as a matter of law — the Board determined it lacked authority to issue an order approving a settlement agreement unless that order included findings of violation. Where the authority of an administrative body is in question, the determination of the scope of its power and authority is a judicial function, not a question to be finally determined by the administrative agency itself. (People ex rel. Thompson v. Property Tax Appeal Board (1974), 22 Ill. App.3d 316, 322, 317 N.E.2d 121, 125, cert. denied (1975), 422 U.S. 1002, 45 L.Ed.2d 666, 95 S.Ct. 2623.) The court is not bound by an agency's conclusion of law. Danison v. Paley (1976), 41 Ill. App.3d 1033, 1036, 355 N.E.2d 230, 233.

The Board tries to characterize its action as a quasi-legislative function. This characterization of the Board's action is more appropriately limited to those instances where the Board is developing general environmental standards through rulemaking or developing individualized standards such as conditions that attach to variance. See Shell Oil Co. v. Pollution Control Board (1976), 37 Ill. App.3d 264, 270, 346 ...


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