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COMMONWEALTH PENNSYLVANIA v. NORWESCO DEVELOPMENT CORPORATION (09/15/87)

decided: September 15, 1987.

COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF ENVIRONMENTAL RESOURCES, PLAINTIFF
v.
NORWESCO DEVELOPMENT CORPORATION, DEFENDANT



Original Jurisdiction in case of Commonwealth of Pennsylvania, Department of Environmental Resources v. Norwesco Development Corporation.

COUNSEL

Zelda Curtiss, Assistant Counsel, with her, James D. Morris, for plaintiff.

Kenneth D. Chestek, Murphy, Taylor & Adams, P.C., for defendant.

Judges Craig and Palladino, and Senior Judge Kalish, sitting as a panel of three. Opinion by Senior Judge Kalish.

Author: Kalish

[ 109 Pa. Commw. Page 335]

Before this court are preliminary objections filed by Norwesco Development Corporation (Norwesco) to a complaint in equity filed by the Commonwealth of Pennsylvania, Department of Environmental Resources (DER). We dismiss the preliminary objections.

Norwesco has explored for and produced petroleum products from various lease sites in Sandy Creek Township, Venango County, Pennsylvania. On January 3, 1986, DER issued an order which found that Norwesco's drilling activities had polluted groundwater in the vicinity of Belmar Village. The order directed Norwesco to provide a temporary water supply to certain residents of Belmar Village, to submit a plan to DER for permanent water supply restoration or replacement, and to implement the approved water replacement plan. Norwesco appealed the order to the Environmental Hearing Board (Board), and filed a petition for supersedeas. Following a hearing on the petition for supersedeas, the petition was denied.

In November, 1985, Norwesco had filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Western District of Pennsylvania. By order dated January 15, 1986, the Bankruptcy Court stayed the enforcement

[ 109 Pa. Commw. Page 336]

    of the January 3, 1986 DER order pending that court's determination as to whether the automatic stay provision of section 362 of the Bankruptcy Code, 11 U.S.C. § 362, applied. DER appealed this order to the United States District Court for the Western District of Pennsylvania. On June 16, 1986, the United States District Court for the Western District of Pennsylvania vacated the stay, and ruled that the automatic stay provision of section 362 of the Bankruptcy Code, 11 U.S.C. § 362, did not apply.

Thereafter, DER filed the instant complaint in equity in this court. Concurrently, DER submitted a motion for preliminary injunction. A hearing on the motion was held on July 10, 1986, at which time Norwesco raised preliminarily the issue of whether the bankruptcy proceedings divested this court of jurisdiction. Norwesco also argued that DER was required to prove the underlying merits of its case before an injunction could issue. Prior to this court's reaching a decision on DER's motion for preliminary injunction, Norwesco advised this court that its plan of reorganization had been confirmed by the Bankruptcy Court, and filed the preliminary objections now before this court. On August 13, 1986, this court granted DER's motion for preliminary injunction, and ordered Norwesco to comply with the January 3, 1986 DER order during the pendency of the appeal before the Board.

Norwesco contends that this court lacks jurisdiction to enforce the DER order. Specifically, Norwesco argues that the DER order is not enforceable prior to a final adjudication before the Board. Norwesco claims that without a full evidentiary hearing, enforcement of the order violates its right to due process. Additionally, Norwesco argues that as a prerequisite to enforcement of the ...


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