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Rayonier, Inc.’s NPDES Permit Does Not Require Compliance With Georgia’s Water Quality Standards For Color, Odor, And Turbidity

Jerry Rice

Altamaha Riverkeeper, Inc. v. Rayonier, Inc.

(Case No. CV 214-44, S.D. Ga. March 31, 2015)

Altamaha Riverkeeper, Inc. (“Plaintiff”) is a nonprofit organization whose goal is to protect and restore the habitat and water quality of the Altamaha River. In that regard, Plaintiff monitors wastewater discharges to ensure compliance with permits and water quality. Rayonier, Inc. (“Defendant”) operates a pulp mill that produces cellulose products from wood chips; the mill discharges some 50 to 60 million gallons of wastewater into the Altamaha River under permit. Plaintiff sued Defendant alleging that Defendant’s wastewater was so much darker than Altamaha’s waters, and that its wastewater “was so malodorous,” that its discharges violated Georgia’s water quality standards for color, odor, and turbidity. Plaintiff alleged that Defendant’s discharges had such an impact on Altamaha’s water quality that its discharges violated Georgia’s narrative water quality standards. Defendant filed a Motion for Summary Judgment, which the district court granted. Interpreting the NPDES permit the Georgia Environmental Protection Division (“GEPD”) granted to Defendant, the district court held that there was no evidence suggesting that GEPD “intended to make [Defendant’s] permit conditions coextensive with the water quality standards found in the [Clean Water Act] and Georgia’s Rules,...requires GEPD to use sufficient words...to arrive at that intention in the permit itself.” (Id., internal citations omitted.)

Background

The Clean Water Act (“CWA”), in intended to restore and maintain the “integrity of the Nation’s waters.” (33 U.S.C. section 1251(a).) CWA directs that no one is entitled to discharge any pollutant from any point source into waters of the United States. (33 U.S.C. sections 1311(a), 1362(12).) Discharges are privileged conditioned on compliance with the requirements of an NPDES permit. (Id. Sections 1311(a), 1342.) One of the hallmarks of

an NPDES is its requirement that the permittee conduct monitoring adequate to demonstrate compliance or non-compliance with the permit’s terms, requiring the certification of the results under threat of criminal sanction. (Id. Sections 1342(a)(2), 1318(a)(A); 40 C.F.R section 122.44(i)(1). As the Fifth Circuit held, the CWA is “strong medicine.” Tex. Mun. Power Agency v. EPA, 836 F.2d 1482, 1488 (5th. Cir. 1988).)

Citizens may file suit on their own behalf alleging violations of an NPDES permit. (33 U.S.C. section 1365(a), (f)(6).) “However, where a permittee discharges pollutants in compliance with the terms of an NPDES permit, the permit “shields” the permittee from liability under the CWA... Section 1342(k)’s permit shield “affords an absolute defense to a permit holder that complies with the conditions of its permit against citizen suits” seeking to enforce certain provisions of the CWA.” (Id., citing to 33 U.S.C. section 1342(k) and Black Warrior Riverkeeper, Inc. v. Black Warrior Minerals, Inc., 734 F.3d 1297, 1303 (11th Cir. 2013).)

To resolve this matter, the district court would have to examine the language of Defendant’s GEPD issued NPDES permit. “While NPDES permits themselves are not contract, they are interpreted as if they were.” (Natural Res. Def. Council, Inc. v. Cnty. of Los Angeles, 725 F.3d 1194, 1204 (9th Cir. 2013).) If the language of the permit, taken as a whole, is plain and capable of construction, then the court must determine the permit’s meaning.

However, if the permit language is ambiguous, courts may take extrinsic evidence into consideration to interpret the permit. (Citations omitted.) “However, under Georgia law and Eleventh Circuit precedent, courts turn to extrinsic evidence to explain ambiguity in a contract ‘only when a contract remains ambiguous after the pertinent rules of construction have been applied.’” (Id., quoting from Claussen v. Aetna Cas. & Sur. Co. 888 F.2d 747, 749 (11th Cir.1989.)

Court’s Rationale

A. Ambiguity

A contract is ambiguous under federal common law if it contains “a duplicity, indistinctness [or] an uncertainty of meaning or expression that makes it susceptible to several reasonable interpretations.” (Id., quoting from Begner v. United States, 428 F.3d 998, 1004-5 (11th Cir. 2005).) At issues is whether Defendant’s NPDES permit incorporates Georgia’s water quality standards set forth in Rule 391-3-6-.03(5)(c). The district court found two occurrences where this occurred.

The first page of Defendant’s NPDES permit states, in pertinent part, that “in compliance with the CWA, the State Act, and their respective rules and regulations,” Defendant is authorized to discharge into the Altamaha River “in accordance with the conditions set forth [in respective parts] of the Permit.” (Id.) This language means that GEPD authorized Defendant’s NPDES permit “in compliance” with Federal and State Acts and their implementing rules, but did not mean that Defendant “may only discharge in compliance with Federal and State acts and their attendant rules and regulations.” (Id.)

  1. Plaintiff argued that Culbertson v. Coats American, Inc., 913 F.Supp. 1572 (N.D. Ga. 1995) held that this language in an NPDES permit does, in fact, incorporate Georgia’s water quality standards as an NPDES permit condition. However, the district court refused to apply Culberson as that case concerned a defendant that conceded to the seminal fact that this provision did indeed intend to make compliance with Georgia water quality law a permit requirement; Defendant, here, was challenging this point. Moreover, the Culbertson court did not undertake the same procedures for interpreting the permit as this court had.

The NPDES permit’s second reference to Georgia’s water quality standards was ambiguous. The permit states, “The Permittee shall comply with effluent standards or prohibitions established by section 307(a) of the Federal Act and with chapter 391-3-6-.03(5) of the State Rules and may not discharge toxic pollutants in concentrations or combinations that are harmful to human, animals, or aquatic life.” This section is ambiguous because its use suggests that it is strictly concerned with toxic pollutants, whereas the actual rule lists a host of water quality standards having nothing to do with toxicity. Because of this ambiguity, the district court had to turn to rules of contract construction to ascertain its meaning.

B. Intent of the Parties

Here, the district court could not ascertain the parties’ intent regarding Georgia’s water quality standards. Plaintiff alleged that GEPD’s intent in drafting the permit “necessarily was to meet the requirements of the Clean Water Act.” (Id.) However, that supposed intent was undermined by another portion of the permit stating “[n]othing in this permit shall be construed to preclude the modification of any condition of this permit when it is determined that the effluent limitations specified herein fail to achieve the applicable State water quality standards.” (Id.) This provision could only “...contemplate the possibility that the Permit’s conditions do not, in fact, incorporate all of Georgia’s water quality standards as conditions of the permit.” (Id.)

Looking beyond canons of contract interpretation, Plaintiff argued that courts should favor a construction in the public interest where a contract dispute is of public concern. This is “a rule of construction rather than one of interpretation, one that for reasons of public policy requires the court to give to a contract that legal operation that is of public advantage, when a choice between that and a less advantageous operation is reasonably open.” (Id.) The district court agreed with the notion that the public does have an interest in protecting the Altamaha River, however, the public would also have an interest in ensuring “that businesses and industries are given explicit notice of what kinds of discharges will violate their NPDES permits before subjecting them to onerous civil penalties.” (Id.) That interest wins out in this matter.

Conclusion

This decision did not intent to suggest that Defendant’s discharges did not have a harmful effect on the Altamaha River, or to minimize Plaintiff’s alleged injuries. This case stands for the proposition Plaintiff failed to show a violation of Defendant’s NPDES permit--i.e. failing to show that Defendant’s permit required it to comply with relevant water quality standards.

 

Author

 

Thierry R. Montoya is a Shareholder in the Firm’s Santa Ana office and the Chair of the Construction Law Department. He represents clients in environmental, land use, construction, and eminent domain matters across the state, and in federal jurisdictions throughout the United States.