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Luther P. Miller, Inc. v. Underground Storage Tank Indemnification Board

February 11, 2009

LUTHER P. MILLER, INC., PETITIONER
v.
UNDERGROUND STORAGE TANK INDEMNIFICATION BOARD, RESPONDENT



The opinion of the court was delivered by: Senior Judge Kelley

Submitted: December 19, 2008

BEFORE: HONORABLE BERNARD L. McGINLEY, Judge, HONORABLE ROBERT SIMPSON, Judge, HONORABLE JAMES R. KELLEY, Senior Judge.

OPINION

Luther P. Miller, Inc. (LPM) petitions for review of an order of the Underground Storage Tank Indemnification Board (Board) which adopted the recommendation of the presiding officer that the decision of the Underground Storage Tank Indemnification Fund (Fund) to deny eligibility for reimbursement from the Fund to LPM be affirmed. We affirm.

The issues in this appeal are: (1) whether LPM is an "owner, operator or certified tank installer" as set forth in Section 706 of the Storage Tank and Spill Prevention Act*fn1 (Act) or otherwise eligible to make a claim for benefits; and (2) whether underground storage tanks must continue to be registered under the provisions of Section 503 of the Act*fn2 in order to make a claim with the Fund.

The stipulated facts in this matter are as follows. LPM is a Pennsylvania corporation with principal offices located in Somerset, Pennsylvania. The property upon which the underground storage tanks were installed was owned by James Little and is located at 2208 Bedford Street, Johnstown, Pennsylvania.

LPM entered into a lease agreement with James Little dated April 26, 1991, as well as an agreement of the same date concerning the underground storage tanks. The lease was for a term of 138 months. In the agreement, Little agreed to remove existing underground storage tanks and remediate the environment as necessary and LPM agreed to install new underground tanks and related equipment. The parties agreed that Little would remain the owner of the tanks during the term of the lease.

Prior to LPM's installation of the new tanks, Little removed the existing tanks, remediated the site and obtained approval for the tank closure from the Pennsylvania Department of Environmental Protection (DEP). LPM installed two underground storage tanks on the site in January 1992, both of which were used to store unleaded gasoline.*fn3 LPM was registered with DEP as the owner and operator of the two tanks. LPM remained the registered owner of the tanks until October 4, 2002, when the registration for the tanks expired.

From June 26, 1991, through June 1999, the site was operated as a retail gasoline station. The underground storage tanks were in use for gasoline storage from January 1992 until June 1999. To the extent practicable, the product was removed from the tanks at that time and, thereafter, contained fuel residue which was unfit for resale.

LPM did not file temporary closure paperwork with DEP when the product was removed from the tanks in 1999. At the expiration of the lease on April 30, 2002, LPM provided Little with the paperwork necessary to register the tanks in Little's name. Neither LPM nor Little filed paperwork with DEP to reflect a change of storage tank ownership after the expiration of the lease.

After the registration of the tanks expired on October 4, 2002, the tanks remained unregistered between October 4, 2002, and March 6, 2006. The registration fees for the tanks were not paid from October 4, 2002, until April 18, 2006.

DEP, relying upon its registration records for ownership of underground storage tanks, sent registration renewal invoices to LPM for 2002, 2003 and 2004. On March 12, 2002, DEP sent a Notice of Violation to LPM for failure to have a requested facility inspection completed. By letter dated October 18, 2002, LPM advised DEP that the tanks had been transferred to Little on May 1, 2002. By letter dated November 10, 2003, LPM advised DEP that upon the expiration of the lease, Little, as the owner of the property, retained the tanks. LPM did not pay DEP's registration invoices because of the dispute over the ownership of the tanks.

On October 31, 2003, DEP visited the site and noted that the facility was inactive at that time. In November 2003 and January 2004, DEP informed LPM and Little that the communications about ownership of the tanks cannot be used to change or amend DEP data for the tanks. DEP also advised LPM and Little that: (1) tank registration would be changed after appropriate forms were submitted; (2) until the new forms were received, the fees would accrue until the new information was processed; and (3) unpaid registration fees would be referred to the Attorney General's office for collection. It is DEP's position that pursuant to its regulations, tank owners are responsible for filing amended registration forms to show changes in ownership and use of the tanks and that registration fees continue to accrue until appropriate closure documents required by the regulations have been submitted.

By administrative order of November 3, 2005, DEP directed LPM to remove the underground storage tanks as the registered owner of the tanks. DEP's order contained findings which included: (1) LPM was the owner of the tanks pursuant to 25 Pa. Code ยง245.1; (2) LPM failed to upgrade the existing tanks to meet 1998 performance standards; and (3) regulations required such tanks to be permanently closed within 12 months of being temporarily closed. The order further required LPM to close the tanks permanently, to take any corrective action required at the site, ...


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