ALJDEC

97A-O119-DEQ · Department of Environmental Quality · 1997-10-08

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 29, 1997.

APPEARANCES: Dennis P. Turnage, Esq. for the Petitioner; Assistant Attorney General Karen Errant for the Arizona Department of Environmental Quality

ADMINISTRATIVE LAW JUDGE: Lewis D. Kowal _____________________________________________________________________

Based on the record of this matter, the following recommended Findings of Fact, Conclusions of Law and Recommended Order are made:

FINDINGS OF FACT 1. On June 24, 1997, the Arizona Department of Environmental Quality (“the Department”) issued a final underground storage tank (“UST”) determination wherein the Department concluded that Jodeane Horner (“Petitioner”) is the owner of the UST that was installed at 6711 West Frier Drive, Glendale, Arizona 85301 (the “Property”) in 1980.

2. Subsequent to the Department’s final decision mentioned above, Petitioner submitted to the Department a request for hearing to appeal that decision. Attached to that request was an Affidavit of the Petitioner containing information pertaining to the Property and the UST on the Property.

3. At the hearing of this matter, Quinn Thacker, an environmental programs specialist with the Department’s UST section, testified that he reviewed Petitioner’s Affidavit and reconsidered ownership of the UST and arrived at the same determination that the Department previously made, namely, that Jodeane Horner is the owner of the UST in question.

4. It is undisputed that in 1980 Mr. and Mrs. Roderick Williams and Mr. and Mrs. Gary Wright sold the Property to Petitioner and her husband, Bill Horner, which consists of approximately ¾ of an acre.

5. Shortly after the purchase of the Property, Petitioner and her husband arranged for the installation of the UST on the Property. Roland Dail of Sunnyboy Water Company dug the pit for the UST, Conway Trucking hauled sand the was placed in the pit upon which the UST sat on and R&R Evans installed the UST.

6. Conway Trucking was a trucking business owned by Mr. Williams.

7. The UST in question consisted of a one thousand tank for unleaded fuel, a ten thousand tank for diesel fuel and a one thousand tank for regular fuel.

8. Petitioner testified that she and her husband paid $60,000.00 for the Property and paid between $10,000.00 and $12,000.00 for the UST and its installation.

9. According to Petitioner, the Property was purchased to operate the family run paving business owned by Petitioner and her husband. The Property was leased to that business which was incorporated under the name of G& P Contracting Co., Inc. (“G&P”). The UST was purchased and installed for the purpose of fueling Petitioner’s equipment on the Property.

10. In June, 1980, Petitioner’s husband became ill and in May, 1983 had a stroke which left him paralyzed. Due to Mr. Horner’s illness, the business plans changed and G&P’ business office was never built on the Property. In 1986, Mr. Horner passed away.

11. In 1987, Petitioner sold the Property to Williams Properties, which is owned by Mr. Williams. At the time of that sale, Mr. Williams did not inspect the Property and testified that he was unaware of the UST on the Property. 12. After acquiring the Property, Mr. Williams rented the Property to a person named John for an undetermined period of time consisting of several years. John used the Property as a place to store junk items. Subsequently, the Property was also used by Eddie Costello(“Mr. Castello”) for the same purpose . The evidence is unclear as to the relationship, if any, between John and Mr. Costello. According to Mr. Williams, Mr. Costello used the Property until January 1997 when the Property was sold.

13. Petitioner testified that from 1980 through 1987, Petitioner did not place diesel or have it placed in the UST nor did Petitioner dispense diesel or cause it to be dispensed from the UST. Likewise, Mr. Williams testified from 1987 through 1997 he did not place diesel or cause it to be placed in the UST nor did he dispense diesel or cause it to be dispensed from the UST.

14. In February 7, 1997, Mr. Williams excavated the UST and removed it from the Property. During that process Mr. Williams discovered that the middle tank contained approximately 2,500 gallons of diesel.

15. In conjunction with the sale of the Property, Mr. Williams learned that a Phase One report was required. As part of that preparing that report, Mr. Williams had soil samples taken from the excavation site which were laboratory tested. The results of that testing revealed that diesel had been released.

16. Petitioner and Mr. Williams both testified that neither of them, during their respective ownership of the Property, had electricity or pumps at the Property. Therefore, they each claimed there would be no way to utilize the diesel in the UST without electricity and pumps. With the evidence presented, there is no reason to disbelieve the testimony of Petitioner or Mr. Williams.

17. Petitioner testified that she did not order or receive a billing for diesel in the UST. Petitioner did not receive a breakdown for the billing from R&R Evans for the UST in question. It is undisputed that at time of installation of the UST, R&R Evans was a fuel dispenser.

18. The evidence presented established that between 1980 and 1997, diesel was placed in the UST and that there was a release of that product. There is no direct evidence establishing who placed the diesel in the UST or when that occurred.

19. Petitioner contends that Mr. Williams does not know how the Property was used on a daily basis by John or Mr. Costello. Mr. Williams testified that he was unaware as to how John or Mr. Castello used the Property other than to store junk. A couple of times a year , Mr. Williams drove by the Property and noticed that junk was being stored on the Property.

20. The Department contends that Mr. Williams provided information in his Affidavit submitted to the Department attesting that he did not place diesel or cause it be placed in the UST or dispensed diesel from the UST and that to his knowledge neither did his tenants.

21. Mr. Thacker testified that he determined that Petitioner is the owner of the UST because she had the UST installed and because the Department could not determine who had placed diesel in the UST or caused it to be released.

22. The evidence presented established that during Petitioner’s ownership of the Property, Petitioner kept construction equipment on the Property. Petitioner testified that the equipment obtained diesel on the property from a fuel tank also maintained on the Property so there was no need for Petitioner to have diesel placed in the UST.

23. The testimony of the Petitioner and Messrs. Williams and Thacker as set forth above is determined to be credible.

24. Petitioner paid approximately $10,000.00 for the UST, construction equipment owned and operated by G&P were maintained on the Property, and G&P’s construction equipment maintained on the Property used diesel. Further, there is no plausible reason presented as to why John or Mr. Costello would cause diesel to be placed in the UST or why they would use the UST in relation to their respective junk business. Viewing the totality of the evidence, though it is circumstantial, it is reasonable to infer that diesel was placed in the UST at time of installation.

CONCLUSIONS OF LAW 1. A.R.S. §49-1001.01 provides, in part , that an “owner” is… “ a person who owns an underground storage tank or a person who owned an underground storage tank immediately before the underground storage tank was taken out of operation. A person who acquires ownership or control of property where an underground storage tank is located is the owner of the underground storage tank….” The statute also provides that such a person may be excepted from ownership if the person meets either of the following: after conducting due diligence, the person did not know or had no reason to know that the UST was located on the property or that the person has not placed regulated substances in the UST or dispensed regulated substances form the UST and that the Department can determine the identity of the previous owner of the property containing the UST that immediately prior to the person’s acquisition of the property.

2. In this case, it was undisputed that Mr. Williams did not conduct a due dilligence investigation. Therefore, for Mr. Williams to be excluded from being an owner , he must meet the second exclusion category of not having placed diesel in the UST or having dispensed diesel from the UST. The Administrative Law Judge determines that it was established that there is evidence to support a determination by the Department that Mr. Williams be excepted from being considered the owner of the UST pursuant to A.R.S. 49-1001.01.

3. Petitioner failed to sustain her burden of proving by a preponderance of the evidence that she is not the owner of the UST and did not present sufficient evidence to establish that the Department’s determination of such ownership should be reversed.

4. The evidence of record supports a finding that Petitioner is the owner of the UST.

RECOMMENDED ORDER The Administrative Law Judge recommends that the Director of the Department affirm the Department’s June 24, 1997, final determination that Petitioner is the owner of the UST at issue.

Done this day October 9, 1997.

______________________________________ Lewis D. Kowal Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 1997, to:

Mr. Russell Rhoades, Director Department of Environmental Quality 3033 North Central Avenue ATTN: Lavonne Watkins Phoenix, AZ 85012

By ___________________________ -----------------------

Office of Administrative Hearings 1700 West Washington, Suite 602 Phoenix, Arizona 85007 (602) 542-9826