371 F.3d 156 | 3rd Cir. | 2004
v. SCIRICA, Chief Judge .
At issue is whether Petitioner
ELAINE L. CHAO,
George Harms Construction Company is
SECRETARY OF LABOR,
entitled to relief under the excusable
UNITED STATES
neglect standard of Fed. R. Civ. P. DEPARTMENT OF LABOR and 60(b)(1), after it failed to timely file a OCCUPATIONAL SAFETY & notice of contest to Occupational Safety
HEALTH REVIEW COMMISSION,
and Health Administration citations and a Respondents notice of penalty delivered by certified mail. We will vacate the Occupational Safety and Health Review Commission’s
On Petition for Review of a Final Order final order and remand for a hearing on the of the Occupational Safety and Health merits of the OSHA citations. Review Commission I. (OSHRC No. 02-0371) Congress enacted the Occupational Safety and Health Act to “assure so far as Argued February 12, 2004 possible” safe working conditions for “every working man and woman in the
Before: SCIRICA, Chief Judge , Nation.” 29 U.S.C. § 651(b). The ROTH and McKEE, Circuit Judges Secretary of Labor is charged with enforcement of the Act. But the Secretary
(Filed: June 9, 2004) has delegated her enforcement duties to the Assistant Secretary for Occupational
John F. Neary, Esquire (Argued) Safety and Health, who heads OSHA. 101 Eisenhower Parkway, Suite 300 Secretary’s Order 5-2002, 67 Fed. Reg. Roseland, New Jersey 07068 infractions. [1] On December 13, 2001, 65008 (Oct. 22, 2002). OSHA inspects workplaces for violations. It may issue a O S H A sent citations to Ha rm s citation for a violation, establish a date for Construction’s post office address by certified mail, return receipt requested. [2] abatement, and propose a civil penalty. 29 U.S.C. §§ 658, 659. An employer can Carol Pelsang, the Harms Construction contest the citation and proposed penalty employee responsible for handling mail, before the Occupational Safety and Health signed for receipt of the citations at least by December 31, 2001. [3] Review Commission. 29 U.S.C. § 661. Under section 10(a) of the Act, an
Harms Construction did not file a employer must file a notice of contest notice of contest within 15 working days within 15 working days of receipt of the of receipt. On January 22, 2002, the citation or the “the citation and the citations became final orders of the assessment, as proposed, shall be deemed Commission by operation of section 10(a) a final order of the Commission and not subject to review by any court or agency.” 29 U.S.C. § 659(a). [1] In the citations, OSHA alleges Harms The Commission, an independent Construction violated 29 C.F.R. § adjudicatory body separate from the 1926.350(h), by having a broken gauge on Department of Labor, acts as a neutral an acetylene cylinder. It also alleges arbiter in proceedings contesting OSHA Harms Construction violated 29 C.F.R. § citations. Cuyahoga Valley Ry. Co. v. 1926.501(b)(1), by not providing a United Transp. Union , 474 U.S. 3, 7 guardrail system, safety net system, or ( 1 9 9 5 ) ( p e r c u r i a m ) . A s s u min g personal fall arrest system on a 10 foot jurisdiction, an Administrative Law Judge high railroad retaining wall. Both of the Commission conducts a hearing and “infractions” were corrected during the issues a report with his determination of course of the OSHA inspections. the proceeding. 29 U.S.C. § 661(j). Within thirty days, the Commission may [2] According to OSHA, when abatement opt to review the ALJ’s report. Id. If no
is not an issue, as is the case here, it would Commissioner directs review, the ALJ’s not include a letter addressed to any report becomes the Commission’s final particular employee with a citation. decision. Id. Judicial review may then be [3] The received date stamped on the sought. 29 U.S.C. § 660. return receipt card was partially obscured
II.
by Pelsang’s signature, so the actual day in December on which the citations were OSHA conducted an inspection of received is unknown. They were at least Harms Construction’s work site in Clifton, received by the end of December 2001 New Jersey from November 29, 2001 to because “December” and “2001” are December 11, 2001. OSHA found two
legible. of the Act. 29 U.S.C. § 659(a). On required to sign for all certified mail not February 28, 2002, more than a month marked “restricted delivery,” place the after Harms Construction’s notice of mail in a mail handling box, and transport contest was due, OSHA issued Harms the mail back to Harms Construction’s Construction a delinquency notice. On headquarters. Then, she would open, March 8, 2002, Edward Nyland, Harms stamp, sort, and earmark the mail for Construction’s President, telephoned delivery. If a letter did not identify the OSHA Assistant Area Director Steve intended recipient, she would determine Kaplan, informing him he had no record of from prior management instructions who the citations but that he wanted an should get the mail. Pelsang had been opportunity to contest and possibly settle instructed to deliver OSHA-related mail to the matter. Kaplan responded that the Harms Construction’s president. If return receipt had been signed by an uncertain it was OSHA-related, she was employee at Harms Construction. Kaplan instructed to ask any corporate officer for recommended that Harms Construction assistance. petition OSHA for settlement. That same
The matter was docketed before the day, Nyland mailed a letter to the Commission on March 14, 2002. On April Commission requesting that Harms 1, 2002, the Secretary filed a motion for a Construction be permitted to file a late time extension to file her complaint in notice of contest due to “clerical error” and order to allow OSHA personnel to pursue that they try to settle the matter. settlement with Harms Construction. Nyland undertook an investigation Three weeks later, on April 23, 2002, to determine what transpired with the instead of filing a complaint, the Secretary citations. He interviewed Pelsang, but she filed a motion to dismiss the proffered told him she had no recollection of the notice of contest as untimely. Harms citations because of the passage of time Construction cross-moved for excusal of and the volume of mail that she routinely its tardy notice of contest. It alleged, handles. Nyland thoroughly searched his among other things, that service was office and inquired whether any of Harms improper, that it was entitled to relief Construction’s corporate officers or other under Fed. R. Civ. P. 60(b)(1) or equitable employees had seen or were aware of the tolling, and that the Secretary had waived citations. But Nyland was unable to the right to challenge the timeliness of uncover any information that a Harms Harms Construction’s notice of contest. Construction employee knew anything On October 9, 2002, an Administrative about the citations. Law Judge conducted hearings in
connection with the Secretary’s dismissal Harms Construction’s mailing motion. At the hearing, OSHA Assistant procedure, according to Nyland, was for Area Director Kaplan and Harms Pelsang to pick up the mail at the Construction President Nyland testified. company’s post office box. She was Harms Construction did not call Pelsang to standard when a notice of contest is
untimely filed. [4] testify. On February 3, 2003, the ALJ filed III. his decision and order granting the A. The Commission’s Authority to Secretary’s dismissal motion. See Sec’y of Consider Relief under Fed. R. Civ. P. Labor v. George Harms Constr. Co. , No. 60(b)(1).
02-0371, 2003 OSAHRC LEXIS 19
Under section 10(a), if an employer (OSAHRC Feb. 3, 2003). Without Pelsang’s testimony, the ALJ held that fails to timely contest a citation within 15 Harms Construction could not demonstrate working days, “the citation and the assessment, as proposed, shall be deemed excusable neglect. Id. at *5-6. He also determined that service was proper, that a final order of the Commission and not the Secretary’s seeking of an extension to subject to review by any court or agency.” 29 U.S.C. § 659(a). But section 12(g) of file her complaint to explore settlement did not constitute a waiver of her right to seek the Act provides that the “Commission is dismissal, and that Fed. R. Civ. P. 60(b)(6) authorized to make such rules as are should not apply. Id. at *7-10. Harms necessary for the orderly transaction of its Construction’s petition for discretionary proceedings. Unless the Commission has adopted a different rule, its proceedings review to the Commission, dated February 18, 2003, was not granted, and the ALJ’s shall be in accordance with the Federal decision became the final order of the Rules of Civil Procedure.” 29 U.S.C. § 661(g). Fed. R. Civ. P. 60(b)(1) provides Commission.
that “[o]n motion and upon such terms as Harms Construction appeals to are just, the court may relieve a party or a vacate the Commission’s order and party’s legal representative from a final remand for a hearing on the merits of the judgment, order, or proceeding for the underlying citations. Harms Construction argues that it is entitled to the relief of “excusable neglect” under Fed. R. Civ. P. [4] The Commission had jurisdiction 60(b)(1), that service was improper, that under 29 U.S.C. § 659. We have appellate the Secretary waived its challenge to the jurisdiction under 29 U.S.C. § 660. untimely notice of contest, that equitable The Commission’s factual findings tolling is warranted, and that relief should must be affirmed if supported by be granted under Fed. R. Civ. P. 60(b)(6). substantial evidence on the record as a Not only does the Secretary dispute those whole. Reich v. D.M. Sabia Co. , 90 F.3d claims, she also contends that section 10(a) 854, 856 (3d Cir. 1996). Its adjudications of the Act, 29 U.S.C. § 659(a), precludes are to be affirmed unless they are arbitrary, the Commission from considering the Fed. capricious, an abuse of discretion, or R. Civ. P. 60(b)(1) “excusable neglect” contrary to law. Id. (citing 5 U.S.C. §
706(2)(A)).
f o ll o w i n g r e a s o n s : ( 1 ) m i s ta k e , desired, no circumstances would ever inadvertence, surprise, or excusable permit a late notice of contest. Id. at 194. neglect . . . .” Id. We did “not believe Congress intended
such a harsh result.” Id. For those Harms Construction contends the reasons, we held the Commission had Commission should have found it was jurisdiction to entertain a late notice of entitled to relief under the “excusable contest under Fed. R. Civ. P. 60(b). Id. at neglect” standard. The Secretary 195. maintains that under section 10(a), citations that are not timely contested are The Secretary urges us to reevaluate “not subject to review by any court or and overrule Hass , claiming that agency,” which precludes the Commission intervening legal developments have from applying Fed. R. Civ. P. 60(b)(1). w e a k e n e d i t s “ ‘ c o n c e p t u a l
underpinnings.’” United States v. Adams , The Secretary acknowledges that 252 F.3d 276, 286 (3d Cir. 2001) (quoting her contention conflicts with J.I. Hass Co. Patterson v. McLean Credit Union , 491 v. OSHRC , 648 F.2d 190 (3d Cir. 1981), in U.S. 164, 173 (1989)). The Secretary which we set aside a Commission order urges judicial deference to the reasonable dismissing a late notice of contest and interpretations of the federal agency directed the Commission to consider charged with implementing an ambiguous whether the employer was entitled to relief provision of a statute, in this case the under Fed. R. Civ. P. 60(b). Id. at 195. Secretary of Labor. See Chevron U.S.A., After examining Fed. R. Civ. P. 60(b)’s Inc. v. Natural Res. Def. Council, Inc. , 467 general applicability to Commission U.S. 837, 842-43 (1984). Since Hass was proceedings, we held Rule 60(b) decided, the Secretary notes, the Supreme authorizes the Commission to reconsider Court has held that the Secretary, as its final orders. Id. at 192-94. Although opposed to the Commission, is charged the Secretary contended that “since the w i t h o v e r a l l r e s p o n s ib i l it y f o r notice of contest was not timely filed, the administering the Act, and when their Commission never had jurisdiction in the interpretations diverge, deference is due to first place,” we held the Commission must the Secretary’s reasonable interpretation. have had jurisdiction at some point or “the Martin v. OSHRC (CF&I Steel Corp.) , 499 citations would be final orders of a U.S. 144, 156-58 (1991). The ambiguity Commission which never had jurisdiction, cited by the Secretary is the conflict and thus would have no effect.” Id. at 193. between section 10(a) and section 12(g) of Reconciling the apparent conflict the Act. between section 10(a) and section 12(g) to We recognize that we may reach the result Congress most likely reevaluate a precedent in light of intended, we reasoned that if section 10(a) intervening authority even without en banc were interpreted the way the Secretary consideration. See United States v. Adams , 252 F.3d at 286 (“[A]lthough a panel of This is not a situation in which we owe this court is bound by, and lacks authority deference to “the fruits of notice-and- to overrule, a published decision of a prior c o m m e n t r u l e m a k i n g o r f o rm a l panel, a panel may reevaluate a precedent adjudication.” Chao v. Russell P. Le Frois in light of intervening authority.”) (internal Builder, Inc. , 291 F.3d 219, 227 (2d Cir. quotations omitted). At issue is whether 2002). An informal interpretation that intervening authority warrants reevaluation “lack[s] the force of law” does not warrant of the matters resolved in Hass or even full Chevron deference. See Christensen reconsideration by en banc review. v. Harris County , 529 U.S. 576, 587
(2000). Because Chevron deference need Despite the Secretary’s assertion, its not be accorded to the Secretary’s interpretation of the Act is not entitled to interpretation that section 10(a) precludes Chevron def eren ce. An agency review by the Commission of an untimely interpretation “qualifies for Chevron notice of contest, the conceptual deference when it appears that Congress underpinnings of Hass have not been delegated authority to the agency generally undermined. to make rules carrying the force of law, and that the agency interpretation claiming Moreover, Chevron deference only deference was promulgated in the exercise applies to reasonable interpretations by the of that authority.” United States v. Mead Secretary. See M artin , 499 U.S. at 158 Corp. , 533 U.S. 218, 226-27 (2001). (“[R]eviewing court should defer to the Otherwise, an agency’s interpretation may Secretary only if the Secretary’s merit the more limited deference interpretation is reasonable .”) (emphasis recognized in Skidmore v. Swift & Co. , 323 added). Although we made no explicit U.S. 134 (1944). See Mead , 533 U.S. at comment in Hass , it is at least arguable 234-35 (recognizing that “reasonable that we implicitly found the Secretary’s agency interpretations carry at least some Fed. R. Civ. P. 60(b)(1) position added persuasive force where Chevron is unreasonable. See 648 F.2d at 194 inapplicable”) (internal quotations (disagreeing with the Secre tar y’s omitted); see also Madison v. Res. for interpretation of section 10(a) because we Human Dev., Inc. , 233 F.3d 175, 186 (3d did not believe Congress intended the C i r . 2000 ) ( “[ I]n f o r m a l a g e n cy “harsh result” that once an employee interpretations are not binding” but are signed for a citation, “no circumstances entitled to respect under Skidmore would permit a late notice of contest”). deference to the extent they are And an interpretation that is arguably p e r s u a s i v e . ) . T h e S e c r e t a r y ’ s unreasonable is not sufficiently persuasive interpretation of section 10(a) was not to warrant Skidmore deference. developed in the course of a regulatory
On appeal, the Secretary advances action. Rather, its interpretation represents an alternative interpretation from that a position taken in the course of litigation. which it put forward in Hass —that section 10(a) acts as a statute of limitations that neglect or neither, but not one or the other. may be subject to equitable tolling “where Accordingly, the Secretary’s alternate the claimant has actively pursued his interpretation does not compel overruling judicial remedies by filing a defective Hass . Moreover, equitable tolling requires pleading during the statutory period, . . . deceit or some other extraordinary grounds has been induced or tricked by his for relief and is not equivalent to the Fed. adversary’s misconduct into allowing the R. Civ. P. 60(b)(1) excusable neglect filing deadline to pass,” Irwin v. Dep’t of standard. Veterans Affairs , 498 U.S. 89, 96 (1990)
We recognize that Hass is in (footnote om itted), or “in some conflict with a recent decision of the Court extraordinary way has been prevented of Appeals for the Second Circuit, Chao v. from asserting his or her rights.” Lake v. Russell P. Le Frois Builder, Inc. , 291 F.3d Arnold , 232 F.3d 360, 370 (3d Cir. 2000) 219 (2d Cir. 2002) (2-1 decision), in which (internal quotations omitted). This the court concluded the Commission may interpretation, the Secretary contends, not exercise jurisdiction based on Fed. R. ameliorates the undue “harsh” results that Civ. P. 60(b)(1). Id. at 229. Like us, the concerned the Hass court. court held the Secretary’s interpretation The Secretary’s alternative was not entitled to Chevron deference. Id. interpretation does not warrant Chevron at 228. But applying Skidmore deference, deference because it is an informal the court found persuasive the Secretary’s opinion. But neither is it persuasive under position that the Commission lacks the more limited Skidmore deference. We jurisdiction when an employer fails to file discern no basis for the Secretary’s a timely notice of contest. Id. at 228-29. contradictory position that the Commission The court disagreed with our reasoning in lacks jurisdiction to consider relief under Hass that “‘uncontested citations become Fed. R. Civ. P. 60(b)(1) but has final orders of the Commission’” and that jurisdiction to consider equitable tolling. the C ommission must have had A tribunal cannot exercise an equitable jurisdiction at some point because “‘if it remedy unless it first has jurisdiction. If never had jurisdiction, the citations would the Commission is not barred by section be final orders of a Commission which 10(a) from applying equitable tolling, as never had jurisdiction, and thus would the Secretary now asserts, then it also have no effect.’” Id. at 229 (quoting Hass , should not be barred from granting Fed. R. 648 F.2d at 193). The court reasoned that Civ. P. 60(b)(1) relief. As noted, section when an employer misses a deadline, the 10(a) provides that the citation “shall be citation does not “become” a final order of deemed a final order of the Commission the Commission on the basis of which it and not subject to review by any court or can grant Fed. R. Civ. P. 60(b) relief; agency.” It would seem to therefore bar instead, under section 10(a), it is “deemed” both equitable tolling and excusable to be a final order. Id. Accordingly, the court rejected the proposition that the Harms Construction argues the “excusable Commission has some residual authority neglect” standard must be broadly over uncontested citations that may permit construed. See Robb v. Norfolk & W. Ry. it to grant relief under Fed. R. Civ. P. Co. , 122 F.3d 354, 361-62 (7th Cir. 1997) 60(b)(1). Id. The dissent agreed with our (acknowledging that “‘excusable neglect’ holding in Hass , reasoning that “whether has a new and broader meaning in the deemed or actual—an order of the aftermath of the [ Pioneer ] decision”). Commission must be one that is within its Although Pioneer involved a Bankruptcy jurisdiction and thus subject to reopening Rule, subsequent courts have held that or reconsideration.” Id. at 231 (Pooler, J., Pioneer ’s interpretation of excusable dissenting). The dissent concluded that neglect extends to other federal procedural though neither section 12(g) of the Act nor rules including Fed. R. Civ. P. 60(b)(1). Fed. R. Civ. P. 60(b) gives the See Robb , 122 F.3d at 362 n.6 (noting that Commission jurisdiction, the Commission, some courts have held it to be an abuse of nonetheless, “has inherent authority to discretion to not grant relief under Fed. R. reconsider or reopen its own deemed Civ. P. 60(b)(1) in certain missed deadline orders and Rule 60(b) provides the situations “in light of Pioneer ”). Pioneer ’s appropriate standard for acting on an broad construction of the excusable a p p l i c a t i o n t o r e o p e n . ” I d . neglect standard applies here as well. Notwithstanding Le Frois , we believe that
Under Pioneer , the determination Hass was correctly decided and has not whether a party’s neglect is “‘excusable’ is been undermined by more recent essentially an equitable one, in which decisions. courts are to take into account all relevant For these reasons, Hass is still circumstances surrounding a party’s failure binding and revision is unwarranted. to file.” Chemetron Corp. v. Jones , 72 Under Hass , section 10(a) is not a bar to F.3d 341, 349 (3d Cir. 1995) (citing Commission review, and it “has Pioneer , 507 U.S. at 395). The Supreme jurisdiction to entertain a late notice of Court identified, without limitation, these contest under” the excusable neglect factors to consider: “the danger of standard of Fed. R. Civ. P. 60(b)(1). 648 prejudice . . . , the length of the delay and F.2d at 194-95. its potentia l impa ct on ju dicia l
proceedings, the reason for the delay, B. The Merits of the Fed. R. Civ. P. including whether it was within the 60(b)(1) Excusable Neglect Claim. reasonable control of the movant, and Harms Construction contends it is whether the movant acted in good faith.” entitled to relief under Fed. R. Civ. P Pioneer , 507 U.S. at 395. 60(b)(1)’s “excusable neglect” standard.
Harms Construction alleges the Citing Pioneer Investment Services v. ALJ erred by weighing too heavily the Brunswisk Assoc. , 507 U.S. 380 (1993), “control” factor at the expense of other relevant Pioneer factors. We agree. The differently, the “control” factor does not ALJ properly recognized that the factors of necessarily trump all the other relevant prejudice and good faith weighed in favor factors. As the Supreme Court concluded of Harms Construction, see George Harms in Pioneer : “[T]he lack of any prejudice to Constr. Co. , 2003 OSAHRC LEXIS 19, at the [opposing party] or to the interests of *4 (holding that “Nyland acted quickly and efficient judicial administration, combined in good faith promptly upon discovering with the good faith of respondents and the fact of the citation” and that “because their counsel, weigh strongly in favor of the Secretary proceeded to litigate the permitting the tardy claim.” 507 U.S. at matter by serving a motion to extend her 398. As the Commission has recognized, time to file her complaint, . . . the late in Fed. R. Civ. P. 60(b)(1) late filing cases, [notice of contest] caused her no it is usually a given that there is “a lack of prejudice”), and there is no evidence that prejudice to the Secretary or to the the delay caused an adverse effect on i n t e r e s t s o f e f f i c i e n t j u d i c i a l efficient judicial administration. But the administration, combined with a lack of ALJ, relying on CalHar Constr. Inc. , No. bad faith by the employer.” CalHar 98-0367, 2000 OSAHRC LEXIS 28 Constr. Inc. , No. 98-0367, 2000 OSAHRC (OSAHRC April 27, 2000), noted that “the LEXIS 28, *6 n.5. But just because those Commission considers a key factor to be factors may nearly always favor the whether the delay was within the petitioner does not mean that the reasonable control of the employer,” and Commission should ignore them. concluded that “[i]t is on this issue that
Moreover, even when assessing the [Harms Construction’s] proof falls short” “control” factor, we do not believe that it because Pelsang, the Harms Construction weighs against Harms Construction here. employee who signed for the citations and The ALJ concluded that without Pelsang’s w a s mo st fam iliar with Har m s testimony, he could not determine whether Construction’s mailing procedures, failed Harms Construction’s failure to file a to testify. Id. *5-6. Without Pelsang’s timely notice of contest was within the testimony, the ALJ held he could not make company’s control. George Harms a determination that the failure to file a Constr. Co. , 2003 OSAHRC LEXIS 19, at timely notice of contest was not within the *6. At the hearing, Nyland testified that company’s control. Id. at *6. Pelsang told him she had no memory of The ALJ’s “excusable neglect” the citations and would have nothing to calculus was improper. Under Pioneer , a add. The ALJ found Nyland to be a court must take into account all relevant credible witness, but held his testimony circumstances surrounding a party’s failure only established that Pelsang made the to file, and failing to disprove “reasonable statement to Nyland; “it does not prove . . control” is not necessarily fatal to a . that she in fact, could not recall accepting petitioner’s request for relief. To state it the citation.” Id. at n.4.
At the hearing, the Secretary did not and is entitled to relief under Fed. R. Civ. P. 60(b)(1). [5] object to Nylan d’s te stimon y as inadmissible hearsay. In an administrative
IV.
hearing, “‘[w]hen [hearsay evidence] is admitted without objection it is to be For the foregoing reasons, we will considered and given its natural probative vacate the Commission’s final order and remand for a hearing on the merits of the effect as if it were in law admissible.’” E & R Erectors v. Sec’y of Labor , 107 F.3d subject OSHA citations. 157, 161 (3d Cir. 1997) (quoting Diaz v. United States , 223 U.S. 442, 450 (1912)). Had the Secretary objected, Harms Construction apparently would have produced Pelsang to testify directly. There is no reason to infer that Pelsang’s testimony would have been adverse to Harms Construction. Because of Pelsang’s lack of memory attributable to the passage of time and volume of mail she administers, Harms Construction reasonably believed she could add nothing of value to the hearing.
Nyland’s testimony of Harms Construction’s otherwise reliable mail- handling procedures demonstrates the loss of the citations was an unforeseeable human error beyond its reasonable control. According to Nyland, Pelsang had been responsible for delivering the mail for six [5] In addition to its Fed. R. Civ. P. years. In that period, Nyland had never 60(b)(1) excusable neglect claim, Harms failed to receive any mail. Accordingly,
Construction also contends that service of the control factor does not weigh against the citations was improper; it is entitled to Harms Construction. Because the Pioneer
equitable tolling; the Secretary waived the factors of good faith, prejudice, efficient right to challenge the timeliness of the judicial administration, and control all notice of contest; and that it is entitled to weigh in favor of Harms Construction, it
relief under Fed. R. Civ. P. 60(b)(6). has sufficiently shown “excusable neglect” Because Harms Construction is entitled to relief under Fed. R. Civ. P. 60(b)(1), we do not reach the merits of these alternative claims.