STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

TOM VISCONTI, )

)

Petitioner, )

)

vs. ) CASE NO. 94-0082

) NORTH PENINSULA UTILITIES ) CORPORATION, and DEPARTMENT OF ) ENVIRONMENTAL PROTECTION, )

)

Respondent. )

) SEABRIDGE CIVIC ASSOCIATION, )

)

Petitioner, )

)

vs. ) CASE NO. 94-1375

) NORTH PENINSULA UTILITIES ) CORPORATION, and DEPARTMENT OF ) ENVIRONMENTAL PROTECTION, )

)

Respondent. )

)

FINAL ORDER ON MOTION FOR ATTORNEY'S FEES AND COSTS AND CLOSING DOAH FILE

This matter comes before Ella Jane P. Davis, a duly assigned hearing officer of the Division of Administrative Hearings upon a timely-filed motion for attorney's fees and costs pursuant to Section 120.57(1)(b)5. F.S.

APPEARANCES

For Petitioners: Stephen R. Ponder, Esquire

Van Houten & Ponder, P.A.

114 South Palmetto Avenue Daytona Beach, Florida 32114

For Respondent, North Peninsula Utilities Corporation:

Mary D. Hansen, Esquire Storch, Hansen & Morris, P.A.

1620 South Clyde Morris Boulevard Suite 300

Daytona Beach, Florida 32119

For Respondent, Department of Environmental Protection:

John L. Chaves, Esquire

Department of Environmental Protection 2600 Blair Stone Road

Tallahassee, Florida 32399-2400

STATEMENT OF THE ISSUE

Whether or not Petitioners should be ordered to pay reasonable costs and attorney's fees to the Respondent North Peninsula Utilities Corporation, and, if so, the determination of the amounts of costs and attorney's fees.

PRELIMINARY STATEMENT

On October 26, 1993, the Department of Environmental Protection (DEP) issued its Notice of Intent to Issue Permit No. 64-236067 to rerate the applicant, North Peninsula Utilities Corporation's (NPU's) wastewater treatment plant percolation pond. On November 22, 1993, Petitioner Seabridge Civic Association (SCA) filed a Section 120.57(1), F.S. petition challenging the issuance. Petitioner Visconti filed his petition on November 26, 1993. Both petitions generally alleged the unreliability of the data supporting the issuance and technical and procedural irregularities in the process DEP undertook in arriving at its decision to issue the permit.

Both petitions were ultimately referred to the Division of Administrative Hearings, consolidated, and set for formal hearing pursuant to Section 120.57(1) F.S.

Until Petitioners retained legal counsel, the entry of orders was repeatedly delayed due to DEP's delay in referring the SCA petition to DOAH, by Petitioner Visconti's absenting himself from the state, and by various parties failure to serve each other with appropriate pleadings.

However, on March 16, 1994, a formal hearing was scheduled for June 15, 1994 in Ormond Beach, Florida. The cases were consolidated on March 18, 1994.

Respondent NPU filed a motion to dismiss, to strike, for more definite statement and for attorneys' fees as to Petitioner Visconti. By order of April 8, 1994 (reconsidered with the same result in the June 6, 1994 order) the motion to strike was granted as to Paragraph 2 of Visconti's petition, the motion to dismiss was denied, and the issues of an attorneys' fee award as to NPU and as to Petitioner Visconti, who had asserted the right to his fees and costs in his response to the motion to dismiss, were reserved. NPU also filed a motion to dismiss as to the SCA petition, which was granted with leave to amend by an order entered June 6, 1994. NPU also moved to dismiss SCA's first amended petition. The ruling on that was reserved for consideration in the recommended order. (See June 22, 1994 after-the-fact order.) For the reasons set out below, there was no recommended order.

On April 28, 1994, counsel entered his notice of appearance on behalf of both Petitioners. NPU filed a "motion" which was treated as a motion in limine to establish the proper scope of the hearing. Petitioners' motion for continuance was considered at the same time. A June 6, 1994 Order disposed of those pending motions and explicitly stated that:

issues as to whether or not the underlying project's permit was correctly granted were closed with the initial permitting of the underlying project and now may be addressed only when NPU applies to renew the underlying project permit or in an agency or Circuit court enforcement action. . . in no case may

the scope for this formal hearing on the percolation pond permit application here

under consideration result in any modification

to the final order/permit status of the underlying project.

Petitioners' motion for continuance was denied. The issue of NPU's entitlement to attorneys' fees from SCA was reserved.

On June 10, 1994, Petitioners' filed their renewed motion for continuance, again on the asserted basis that DEP had failed to timely provide file information necessary for Petitioners to obtain expert opinions to support their case that reasonable assurances had not been provided by NPU. A joint prehearing stipulation was filed on June 13, 1994. The renewed motion for continuance and Petitioners' motion to view site were denied after a telephone hearing on June 14, 1994.

The formal hearing convened on June 15, 1994 in Ormond Beach, Florida, at which time counsel for Petitioners announced he was conceding that NPU would establish that it had provided DEP with reasonable assurance that NPU was entitled to issuance of its rerating permit. As the basis for his concession, he asserted that DEP had not provided information requested by Petitioner Visconti on May 6, 1994, which was essential to prepare the Petitioners' case for formal hearing. However, neither of the Petitioners, either before or after acquiring legal counsel, had utilized any of the discovery procedures available pursuant to Section 120.58, F.S.

Petitioners' counsel concurred that the issue of "improper purpose" for an award of attorneys' fees to NPU was preserved in the prehearing stipulation.

The formal hearing proceeded solely on the issue of NPU's entitlement, vel non, to attorneys fees and costs under Section 120.57(1)(b)5 F.S. (TR-Vol. B p. 18; Vol. E pp. 45-46).

Respondent NPU presented the testimony of Tyree Wilson, president and owner of NPU; Zev Cohen, P.E., NPU's consulting engineer for the 1991 plant expansion and for NPU's 1993 rerate application which would have been the subject of the merits proceeding had it occurred on June 15, 1994; Petitioner Visconti; Richard Tyde, vice-president of Petitioner SCA; Christianne Ferraro, P.E., the DEP Orlando District Program Manager for Domestic Wastewater Treatment Systems; and Thomas Cloud, Esquire, who was stipulated by the parties to be an expert in Florida environmental, administrative and wastewater utility law, and who was allowed to give his opinion as to the reasonableness of the attorney's fees and costs requested by NPU.

Petitioners presented the oral testimony of Petitioners Visconti and Tyde, Nadja Decker, and Pat McCarthy.

Respondent NPU had nine exhibits identified, of which seven were admitted in evidence.

Petitioners had 22 exhibits identified, of which 21 were admitted.

The exhibits included the June 13, 1994 prehearing stipulation, including official recognition of various statutory and rule sections.

The statements of factual and legal issues in the prehearing stipulation were not entirely borne out by the evidence adduced at the hearing. Because the

prehearing stipulation favored Petitioners and because Petitioners conceded that NPU had provided reasonable assurance, such inconsistencies are considered of little import and of no prejudice to either party.

Mr. Cloud's testimony was continued to a June 29, 1994 telephone hearing as stipulated by the parties. The billing record of NPU's counsel was admitted, and Petitioners presented the testimony of Robert Rizzio, Esquire, who was qualified as an expert in reasonable and customary attorney's fees in the Daytona Beach area.

An Order Relinquishing Jurisdiction was entered on June 29, 1994. It provided in pertinent part:

At the close of evidence on June 29, 1994, the Department of Environmental Protection

orally moved for the Division of Administrative Hearings to relinquish jurisdiction on the merits for the entry of a final order granting the permit at issue. North Peninsula Utilities withdrew its motion for a recommended order of dismissal and joined in the motion to relinquish jurisdiction, provided jurisdiction on attorney's fees and costs was reserved for disposition by the undersigned.

Petitioners joined in the motion to relinquish jurisdiction and entry of a final order granting the permit, provided the issue on attorney's fees and costs was reserved.

Upon the foregoing, it appears that there are no longer any disputed issues of material fact as to

the permit application, and the parties have conceded that the permit applicant has shown reasonable assurances for the immediate issuance of its permit.

Accordingly, jurisdiction of this cause is hereby relinquished to the Department of Environmental Protection for entry of an order consistent with the parties' stipulations.

Jurisdiction of the issue of whether or not North Peninsula Utilities Corporation is entitled to any attorney's fees and costs pursuant to Section 120.57(1)(b)5. F.S. is reserved for disposition subsequent to any period for appeal or determination of any appeal which may be taken from interlocutory orders or the final order.

The transcript of proceedings and proposed orders by NPU and Petitioners were filed on July 15, 1994. On August 16, 1994, the undersigned was notified that the agency's final order granting the permit had become final without appeal on August 6, 1994. Rulings pursuant to Section 120.59(2) F.S. have been dispensed with, the parties acquiescing (TR - Vol. E pp. 48-50).

FINDINGS OF FACT

1. A brief background of the parties' history is important to disposition of the attorney's fees and costs motion.

2. Petitioner Thomas Visconti is a resident of Seabridge Subdivision and is provided with wastewater treatment service by Respondent NPU. His property is not adjacent to NPU's treatment facility and the record does not establish that Mr. Visconti owns or operates any potable water wells within the vicinity of NPU's facility. See Finding of Fact 19, infra., concerning absence of any potable wells that could be affected by rerating the percolation pond.

   
   

3. SCA is a homeowner's corporation which does not own property adjacent to the NPU facility, but which allegedly has members who do. The authority of the SCA vice-president to file the initial petition in November 1993 is subject to some conjecture, since the way this was done was because the SCA president informally delegated all duties to the vice-president while the president was out of state and all or most of the members signed the petition. There is no evidence the SCA bylaws permitted either such a delegation or the act of filing the Section 120.57(1) F.S. petition. Although an amended petition months later cured the "authority to file" problem, no evidence ever established which, if any, association members owned property adjacent to the NPU facility.

   
   

4. Respondent NPU has owned and operated its Seabridge wastewater treatment plant since 1989. At that time, the plant had been rated at .9 MGD because of the previous owner's decision to economize by using an extended aeration form of treatment rather than contact stabilization method for which the plant had been designed. If the previous owner had utilized the contact method, the facility would have been rated at .157 MGD. The capacity of the plant percolation ponds at the time NPU acquired the facility was .157 MGD.

   
   

5. In 1991, NPU applied for and received a Department of Environmental Regulation (DER, predecessor agency to DEP) permit to expand the facility to a treatment capacity of .210 MGD. Legal and appropriate notice of the Department's Intent to Issue was provided to the public. It was never formally challenged pursuant to Section 120.57(1) F.S., and the DER permit became final. Mr. Visconti and SCA felt abused by the agency and by NPU because they, Visconti and SCA, had missed that window of opportunity to challenge the 1991 plant expansion permit. Thereafter, they proceeded to fight NPU on the expansion and every other issue in whatever forum was available, notably before the Volusia County Commission and the Florida Public Service Commission.

   
   

6. Mr. Visconti, acting as head of the SCA Sewer Committee, wrote a March 10, 1993 letter to DEP that stated, in pertinent part, as follows:

   
   

   Seabridge Civic Association, Inc. (hereafter "SCA") wishes to apprise you that SCA hereby intends to petition the DER for an administrative hearing(s) upon your giving any Notice of Intent to Issue any further permits, particularly any future 0.210 MGD Operating Permit, for the "Seabridge Subdivision" Sewer Treatment Plant.

   
   

   The letter, confirmed by Mr. Visconti's and Mr. Tyde's oral testimony, shows that Mr. Visconti and SCA intended to oppose any permit NPU applied for, regardless of its purpose, and that they knew of the original .210 MGD permit at that time. It goes on to protest sewer connections and previously finalized old permits. Mr. Visconti also wrote a July 2, 1993 letter to DEP, limiting communication, which stated, in pertinent part, as follows:

   Effective after today, please be advised that the official single point communication link between DER and SCA is with SCA President Charles Dassance.

   
   

7. NPU's consulting engineer submitted "as-built" plans of the expansion in early 1993 after the NPU plant expansion construction had been completed.

   The percolation pond had been expanded to a lesser degree than that authorized by the 1991 DER permit because NPU had had to accommodate Volusia County setback requirements which eliminated approximately 11,000 square feet of pond bottom.

   NPU's engineer timely made the Department aware of the discrepancy and discussions occurred with the Department as to how to resolve it. NPU's engineer commissioned a groundwater engineering company to prepare a report to justify effluent disposal capacity of the percolation pond at the rate of .210 MGD, which was done on April 12, 1993 by PSI/Jammal & Associates ("the April Jammal report.") Not satisfied that the model used by Jammal for the April report could be verified by computer means available to the Department, DEP required a corroborating mounding analysis which was submitted on July 23, 1993 ("the July Jammal report.") In the meantime, DEP limited the percolation pond loading rate to .151 MGD until the applicant could justify a higher loading rate.

   
   

8. NPU's 1991 construction permit for .210 MGD had expired in July of 1993. Needing a vehicle by which the review of the applicant's request to rerate the pond could take place, DEP required submittal of a construction permit application, which NPU subsequently filed on August 11, 1993 at the Department's Orlando office. To demonstrate reasonable assurance for the rerating authorization, NPU submitted the July 23 mounding analysis and showed that the loading rate would not be greater than 5.6 gallons per day per square foot. Percolation is considered to be excellent at the Seabridge treatment plant site because of the soil types underlying it, and the 5.6 figure is within the parameters of DEP's current rules.

   
   

9. On October 26, 1993, DEP issued its Notice of Intent to issue the rerating permit for .181 MGD, calculated by multiplying the pond bottom area by the loading rate of 5.6 gpd2, which constituted a reduction from the 1991 .210 MGD loading rate approval. The Notice was published on November 11, 1993, and both Petitioners received individual Notice of the Intent to Issue.

   
   

10. On November 22, 1993, SCA filed its petition challenging the proposed rerate authorization. Petitioner Visconti timely filed his petition on November 26, 1993.

    
    

11. To establish substantial interests, Petitioners generally alleged that the noise, odor, and unsightliness of the plant would be increased if the rerating were to be approved. They also alleged adverse effects to property values, disparities in the technical information NPU had provided in support of its rerating application, and improper procedures employed by DEP in that it had not coordinated with Volusia County.

    
    

12. Petitioners' asserted that their "proper purpose" for filing their petitions was that they had seen a 1993 letter of the DEP Regional Director to the effect that the pond was only licensed for .151 MGD and they assumed a new permit application for .181 MGD would constitute a dangerous increase. This assertion is spurious because both Mr. Visconti and Mr. Tyde admitted they had not even seen the rerate application before filing their petitions and that they did not know what the rerate application said until well into the formal

    administrative hearing process. Assuming, arguendo that the prior letter and DEP's Notice of Intent on its face could have misled Petitioners into believing there would be an increase from .151 MGD to .181 MGD instead of a decrease from

    .210 MGD to .181 MGD, that, alone, does not demonstrate a proper purpose in light of all the contrary and clarifying information available to Petitioners upon reasonable inquiry and which they chose to ignore.

    
    

13. Because of the allegations of technical disparity and improper procedure, Visconti's petition was sustained against NPU's motion to dismiss with one paragraph struck. The SCA petition was dismissed for lack of showing of substantial interest and the amended SCA petition was challenged by NPU on the same basis, with ruling reserved for the recommended order. (See, the April

    8 and June 6, 1994 orders, discussed supra.)

    
    

14. After acknowledging on June 15, 1994 that NPU could demonstrate reasonable assurances, Petitioners presented evidence with regard to whether they had conducted a "reasonable inquiry" prior to filing the November 1993 petitions, but presented no proof as to their allegations of substantial interest contained in their petitions. Based on the evidence, it is found that neither Petitioner had any substantial interest which gave them standing to proceed with their challenges.

    
    

15. Prior to filing their petitions, neither Petitioner had looked at NPU's August 1993 permit application. Between the Notice of Intent to Issue and filing their petitions, neither Petitioner contacted either DEP or NPU, nor conducted any review of the DEP files for data in support of their contention that the rerate authorization had been improperly granted by DEP. Petitioner SCA relied entirely on research conducted by Mr. Visconti when he had been chairman of SCA's Sewer Committee prior to July 2, 1993. Mr. Visconti's last review of NPU's files at the Department had been in June 1993, two months before the rerate application was even filed.

    
    

16. Mr. Visconti ostensibly filed his petition upon his own opinion that the pond capacity was being increased from .151 to .181 instead of decreased from .210 to .181. His testimony was evasive or obstructionist in replying to reasonable questions concerning his area of expertise for forming his opinion, except to say that as a management consultant for unspecified high technology companies on how to manage their programs for federal, state, and local governments, he could interpret rules as well as anybody. As to his interpretation of DEP rules, however, he testified that he did not know precisely what the DEP capacity rules were; he did not ask any questions of DEP after the notice of intent to grant was issued, and he relied on hearsay from other SCA members. He never contacted NPU or their engineers after the rerate application. He opposed NPU's entitlement to the rerate permit even if NPU met all DEP rules, and he intended that his petition would cause the plant to go back the way it was before the 1991 expansion. He knew that the F.A.C. standard had changed to permit 5.6 GPDs, but he still objected to granting the permit on the terms contained in the rule.

    
    

17. Mr. Visconti further testified that he knew in 1991 that a permit for

    .210 capacity had been issued and that the 1991 assessment was that percolation was excellent at the site. Although he had not seen the new permit application before filing his petition, he testified that he would not have cared if the application had said it reduced from .210 to .181, because he would still believe it was an increase. He never checked to see if the Intent to Issue had reconciled his pre-application concerns. He told himself the rerate would possibly increase pollutants. He did not know if June 1993 letters he relied on

    concerning a permit expiring and a .151 capacity of the pond had anything to do with the new permit application; he did not ask anybody, but just decided that they did. He admitted he intended to contest any and every permit NPU ever applied for regardless of what the permit was for. Despite the fact that the percolation pond has no equipment in it, he felt it was just "logical" that noise would increase. He admitted that he has never even looked over the fence, and so his petition's complaint of unsightliness was based solely on the already completed plant expansion, not the 1993 rerate application for the percolation pond which his petition challenged. He never asked DEP or any lawyer if noise, odor and aesthetics constitute pollution concerns; he assumed DEP personnel were incompetent; he decided DEP was withholding information from him because DEP did not keep all old permits for one facility or site in a single file and because papers he had seen in Public Service Commission and Volusia County files were not always in DEP files. He did not verify if the allegation in his petition that NPU did not own the land had been resolved before he filed his petition.

    He did not know that it had been resolved.

    
    

18. Mr. Visconti left town for the entire five months immediately after filing his petition, with no concern as to how this might affect litigation.

    
    

19. Mr. Tyde, now president of SCA, also testified that he filed the SCA petition because he believed there was to be an expansion of the plant. He specifically testified that he relied on Mr. Visconti's old research, except that he massaged some figures of his own based on standards of the Department of Health and Rehabilitation so as to compare that agency's condominium connection requirements with single family dwelling connections. Apparently, SCA opposes the influx of condominiums to its area. However, this subject matter has no real nexus to the gallonage one NPU percolation pond can accommodate under DEP rules, and it only goes to the Petitioners' belief that any change, starting with the 1991 expansion permit, impacts on property values and plant capacity and is simply a bad thing. Mr. Tyde filed SCA's initial petition without knowing if the SCA by-laws permitted him to do so. He decided there was expansion solely on the basis of a DEP letter that had been written before the current application was made. He believed erroneously that the words "rerating" and "increase" are synonymous. He never contacted anybody at DEP to verify his analysis; he filed the petition within nine days of the Notice of Intent to Issue, concentrating not upon the validity of the allegations but upon format. He knew there were no potable wells that would be affected by the plant so that paragraph six of SCA's amended petition drafted to further explain the disparities which were alleged environmental dangers could not possibly be correct. The intent of the SCA petition was not to challenge the pond rerating but to revert the area to what it had been before NPU's completed 1991-1993 expansion, and it was filed with the knowledge that NPU had spent a lot of money to complete that construction and would have to spend more to litigate the pond rerate application.

    
    

20. When Petitioners admitted on the day scheduled for formal hearing on the merits that NPU and DEP would be able to show reasonable assurance for granting the permit, they thereby admitted that their petitions' allegations of disparities in the technical information NPU had provided could not be substantiated. Evidence at the fees hearing showed their allegations about data disparities were irrelevant to the pond rerate permit because the "disparities" the Petitioners were concerned about related to the collection or treatment processes of the plant, the permit for which had long-ago become final, or they were irrelevant because they were related to potential enforcement actions if something went wrong at the plant or if NPU operations violated DEP rules. The so-called "disparities" did not concern the percolation pond's capability. No

    reason to file any violation/enforcement action against NPU existed at the time the petitions were filed.

    
    

21. Because the NPU facility was never involved in a DEP enforcement proceeding and was in constant touch with DER per the procedures outlined in Findings of Fact 5, and 7-9 and 20 supra, it is found that the "as built" construction of the pond at less than the originally authorized maximum capacity did not provide evidence that DEP had not followed its own rules for processing NPU's 1993 permit application and for its Intent to Issue.

    
    

22. With regard to the procedure (mounding calculations) employed by DEP in approving the rerate, it was shown that Mr. Visconti waited until February 1994 to discuss his 1993 materials with a college professor of geology, another professor, and a professional engineer. Only in February 1994, three months after filing the petitions, did Mr. Visconti present these "experts" with the 1993 data, and even then he asked them about hypothetical flows from values he made up. When they could not give him any definitive answers, he claimed that DEP had withheld information and moved to continue the administrative proceeding.

    
    

23. In considering the evidence, the candor and demeanor of all the witnesses has been weighed and the issue of whether or not DEP impeded Petitioners' access to agency files at any time is resolved against Petitioners and in favor of the agency. In so doing, consideration has been given to the evidence that SAC allowed Mr. Visconti to "take the point" on all investigations instead of doing anything on its own. That Petitioners, as laymen, may have been confused by DEP's use of discreet files for each of the successive permits applied for by NPU and granted or denied by the agency has been considered. The undersigned also appreciates that Mr. Visconti never understood that after some permits were granted, only microfilm copies of certain preliminary items remained. However, even so, Mr. Visconti's own testimony is to the effect that he was so fixated on the idea of a "conspiracy" or "collusion" between DEP and NPU that he rejected all explanations by DEP personnel and persisted in the ideation that DEP's failure to copy him with copies of all correspondence between the applicant and the agency pointed to collusion. He assumed, without good legal cause, that if something he had previously seen or thought should be in the agency file was not, in fact, in the agency file, he therefore had a right to file a petition against any permit application. Likewise, he decided, also without good legal cause that if there were anything in the agency file that caused him "concern" or which was different than the current permit application papers but which applied to any prior permit, he had a right to challenge the current permit application. The single instance of lack of cooperation and courtesy by one DEP employee as related by Ms. McCarthy concerning one telephoned question is accepted, but that single incident is not enough to swing the balance and absolve Petitioners of making a reasonable investigation before they filed their petitions. There is no evidence that the single question related to this permit; it was asked before the application for this permit was made and before the Intent to Issue was published; and the question apparently was never repeated. None of this evidence established any proper purpose in Petitioners for alleging data disparities or procedural irregularities, however defined.

    
    

24. NPU presented evidence it had employed its attorney and agreed to pay certain fees and that its attorney's fees and costs are reasonable with the exception of the billings between October 5 and October 29, 1993. The allowable amount totals $24,690.00 in attorney's fees and $2,434.83 in costs. Petitioner Visconti established no evidence with regard to his counter motion for

    attorney's fees upon any legal theory whatsoever. DEP established no independent motion, entitlement, or amount of fees and costs.

    
    

    CONCLUSIONS OF LAW

    
    

25. The Division of Administrative Hearings has jurisdiction over the parties and subject matter of this cause, pursuant to Section 120.57(1)(b)5., F.S.

    
    

    Miscellaneous Matters and Motions

    
    

26. The parties' proposed orders have briefed the issue of attorney's fees and costs under both Section 120.57(1)(b)5. and Section 120.59(6) F.S. NPU seems to seek Section 120.59(6) F.S. sanctions against Petitioners' attorney, as well as Petitioners, after April 28, 1994. NPU even suggested that the undersigned can order the agency to remand the case for entry of a recommended order pursuant to Section 120.59(6) F.S. Both parties appear to condition their suggestions upon whether or not Petitioners either appealed DEP's final order granting the permit which became final without appeal after relinquishment of jurisdiction by DOAH or whether or not Petitioners will now appeal this final order upon the limited reservation of jurisdiction pursuant to Section 120.57(1)(b)5. F.S. Their legal theories are not entirely clear from their proposals.

    
    

27. It is not necessary to reach the foregoing issues. NPU limited itself to a theory of recovery based solely upon Section 120.57(1)(b)5. (TR-Vol. B. p. 18; Vol. E. pp. 45-46). This section applies at the time the petitions were filed. The June 29, 1994 Order Relinquishing Jurisdiction contained a reservation of jurisdiction limited exclusively to that timely-raised issue.

    Any prayer for relief now raised pursuant to Section 120.59(6) F.S. is therefore untimely, sans the jurisdiction of DOAH, and denied.

    
    

28. The method of resolving the issue with regard to Section 120.57(1)(b)5. F.S. by an evidentiary hearing was discretional with the hearing officer and was appropriate, given the parties' stipulations throughout the record. Although ideally, a separate evidentiary hearing on the attorney's fees and costs issue is unnecessary and is not mandated by statute, where an evidentiary hearing is deemed necessary, the hearing officer may retain jurisdiction and make findings of fact in a later order. See, Department of Health and Rehabilitative Services v. H.E.R., 13 FALR 243, (1990) and Florida Audubon Society v. Remington, 12 FALR 3400 (1990). This has been the case even where a voluntary dismissal has occurred or a request for hearing/petition has been withdrawn. See, Johnson Controls, Inc. v. Dept. of General Services and Landis & Gyr Powers, Inc. DOAH Final Order 93-4272 (January 11, 1994) and The Corporation of the President of Jesus Christ of Latter Day Saints v. St. Johns River Water Management District and the City of Ocala, 13 FALR 1014 (1991). The same approach applies where, as here, there has been a stipulated limited reservation of jurisdiction. Under this procedure, the instant order is a final order of the DOAH hearing officer, subject only to appeal to the District Court of Appeals. See, Johnson Controls, Inc. v. Dept. of General Services and Landis & Gyr Powers, Inc., supra. and Chipola Basin Protective Group Inc. v. Dept. of Environmental Regulation, 11 FALR 467 (1988). It is not an opportunity to introduce new theories of fees and costs recovery nor to fan back into flame a controversy fully extinguished by the unappealed DEP final order granting the permit.

29. NPU also intimated for the first time in its post-hearing proposals that if it prevails under Section 120.57(1)(b)5 F.S., NPU should be permitted to submit additional attorney's fees and costs affidavits and records for post- hearing work because such work is a "foreseeable circumstance," and NPU moved that another formal hearing be held thereon. The only items that could be legitimately addressed thereby would be the post-hearing proposals themselves, which is a matter of minimal concern at this stage of the proceedings. That issue could have been, and was not, preserved by timely motion, and it was not contemplated by the parties' stipulations. Eventually, litigation, even as to fees and costs, must come to an end. The motion is denied.

    
    

    Recovery Under Section 120.57(1)(b)5.

    
    

30. Petitioners' proposed order and closing memorandum of law suggests that the failure to dismiss the petitions at early stages now precludes an award of attorney's fees and costs because, "justiciable issues of fact appeared to be raised by Petitioners at the inception of this proceeding since a large portion of the petition filed by Tom Visconti in their action survived the initial motion to dismiss...and further Petitioner Seabridge Civic Association, Inc.'s amended petition... had not been dismissed at the time of...formal hearing." This argument is rejected upon the clear facts of this case, including but not limited to Findings of Fact 13 and 20 supra. In an abundance of caution, the hearing officer gave Petitioners the benefit of the doubt at the pleading stage even though NPU had given timely notice "promptly upon discovering a basis" to seek sanctions, and despite the case law that instructs that "at the earliest stage at which a violation of the [provision] can be determined," a hearing officer is obligated to act. See, Mercedes Lighting & Electrical Supply Inc. v. Department of General Services 560 So.2d 272 at 277 (Fla. 1st DCA 1990) and Harvey v. Trans Pac, Inc., 12 FALR 4378 (1990). Motions to dismiss should be sparingly granted, and liberal amendment is desirable in the administrative forum. Mercedes provides that the Section 120.57(1)(b)5. issue remains properly preserved, provided the hearing officer notifies the parties that sanctions will be assessed at the end of trial, if appropriate. That minimal requirement was met in the interlocutory orders herein.

    
    

31. Also contrary to Petitioners' argument, the less than maximum capacity "as built" construction in 1991-1993 did not constitute a DEP rule violation sufficient to support a "proper purpose" argument. (See Findings of Facts 7-9 and 20-22).

    
    

32. Section 120.57(1)(b)5 F.S. provides:

    
    

    All pleadings, motions, or other papers filed in the proceeding must be signed by a party, the party's attorney, or the party's qualified representative. The signature of a party, a party's attorney, or a party's qualified representative constitutes a certificate that he has read the pleading, motion or other paper

    and that, to the best of his knowledge, information

    ,and belief formed after reasonable inquiry, it is not interposed for any improper purposes, such as to harass or to cause unnecessary delay or for

    frivolous purpose or needless increase in the cost of litigation. If a pleading, motion, or other paper is signed in violation of these requirements,

    the hearing officer, upon motion or his own initiative

    shall impose upon the person who signed it, a represented party, or both, an appropriate sanction, which may include an order to pay the other party or parties the amount of reasonable expenses incurred because of the filing of the pleading, motion, or other paper, including a reasonable attorney's fee. (Emphasis supplied)

    
    

33. In contrast to Section 120.59(6) F.S., there is a complete body of case law available for application to the above section. Patterned after Rule 11, Federal Rules of Civil Procedure, Section 120.57(1)(b)5 F.S. may be interpreted in part by resort to the abundant federal cases analyzing that rule. See, the Florida "lodestar" case on this issue, Mercedes Lighting and Electrical Supply, Inc. v. State Department of General Services, supra.

    
    

34. The court in Mercedes held that, unlike Rule 11, Florida's law only requires that the paper not be interposed for an improper purpose, and does not require that the paper be well grounded in fact or warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law. The Florida Legislature intentionally omitted the foregoing Rule 11 clauses from Section 120.57(1)(b)5. F.S.

    
    

35. In considering what constitutes "improper purpose" under this section, Mercedes states that the hearing officer "should not delve into a good faith-bad faith analysis." Willfulness is not a requirement under Section 120.57(1)(b)5.

    F.S. Indeed, NPU has stipulated herein that "Improper purpose is an objective test, not a subjective purpose, but improper purpose may be found from a pattern of reasons other than defending substantial environmental interests (TR Vol. E. pp. 47-48). This is a fair restatement of the test to be applied.

    
    

36. See, Good Samaritan Hospital v. Dept. of Health and Rehabilitative Services, 582 So.2d 722 (Fla. 4th DCA 1991) (4th DCA July 3, 1991), quoting from Mercedes.

    
    

    if a reasonably clear legal justification can

    be shown for the filing of the paper in question, improper purpose cannot be found ....As an example

    ... improper purpose may be manifested by excessive persistence in pursuing a claim or defense in the face of adverse rulings, or by obdurate resistance out of proportion to the amounts or issues at stake.

    
    

37. Pursuant to Mercedes, "frivolous purpose," used as an example of an "improper purpose" in Section 120.57(1)(b)5 F.S. is defined as a purpose

    
    

    which is of little significance or importance in

    the context of the goal of administrative proceedings

    
    

38. Examples of improper purposes recognized in Mercedes include litigation which delays approval of a litigant's certificate of need application so that the competitor can continue a monopoly or creating delays and costs over an environmental permit in an effort to bankrupt another. An administrative complaint found not to be supported by a permissible interpretation of applicable statutes and rules was held to have been filed for an "improper purpose," despite "an absence of frivolousness" in Good Samaritan Hospital v. Dept. of Health and Rehabilitative Services, supra.

39. In "Attorneys Fees and Costs in Administrative Proceedings," Vol. XIII, No. 3 Fla. Bar Administrative Law Section Newsletter, Marguerite H. ("Ditti") Davis, now a judge of the First District Court of Appeals, commented that, "a concomitant argument can be made for Section 120.57(1)(b)5 F.S. cases, as under Section 120.59(6) F.S., that repetitive litigation on the same issue, asserting vacuous factual allegations or a legal argument having no basis constitutes an improper purpose." Something of the same approach was adopted by the Third District Court of Appeal in its affirmance of a Section 120.57(1)(b)5

    F.S. attorney's fee and cost award in Dolphins Plus v. Residents of Key Largo, at 598 So.2d 324 (Fla. 3d DCA 1992), directing the agency to adopt the recommended order in Residents of Key Largo Ocean Shores and Hobdy v. Dolphins Plus and Dept. of Environmental Regulation 13 FALR 4278 (1991). The appellate court based its ruling in Dolphins, upholding a Section 120.57(1)(b)5. F.S. award, upon reasoning which had upheld a Section 120.59(6) F.S. award in Burke

    v. Harbor Estates Assocs., 591 So 2d 1034 (Fla. 1st DCA 1991). Although Burke was decided upon Section 120.59(6) F.S. and the loftier issue in both appellate court decisions was that the higher courts would not permit an agency to circumvent findings of fact by a DOAH hearing officer, Burke addressed a situation similar to the case at bar and presents some instructive points. The Burke court considered that an improper purpose under Section 120.59(6) F.S. had been established where a layman, acting as a qualified representative, submitted no evidence to show facts necessary to sustain the petition; fact witnesses' testimony was not material; there was a consistent demonstration of lack of knowledge of the applicable law and scope of formal hearing; and there was a complete absence of a justiciable issue of law.

    
    

40. It is noted that the Burke court rejected the argument that a lay qualified representative in a Section 120.57(1) proceeding should be held to a lesser standard of conduct than a licensed attorney. However, the case sub- judice does not involve "qualified representatives" pursuant to Rules 60Q-2.007 and 60Q-2.008 F.A.C. Before imposing monetary sanctions under Section 120.57(1)(b)5. F.S., all doubts should be resolved in favor of the signer. See, The Corporation of the President of the Church of Jesus Christ of Latter Day Saints v. St. John's River Water Management District and the City of Cocoa, supra. Likewise, findings of "improper purpose" should be narrowly construed on a case by case basis to avoid creating a chilling effect upon citizens' legitimate interests.

    
    

41. Indeed, Petitioners legitimately assert, per Mercedes, supra, and Groves-Watkins Construction v. Dept. of Transportation, 511 So 2d 323 (Fla. 1st DCA 1987), that "one of the proper purposes of this type of administrative proceeding is to provide people whose substantial interests are affected by intended agency action an opportunity to change the subject agency's mind."

    
    

42. Therefore, in the administrative forum, even more so than in courts of general jurisdiction established under Article V of the Florida Constitution, attorney's fee statutes, which are creatures of the Legislature in derogation of the common law, should be strictly construed. See, Whiten v. Progressive Casualty Ins. Co. 410 So. 2d 501 (Fla. 1982).

    
    

43. To those ends, all of the evidence and the parties' respective proposals have been thoughtfully considered, and those legal and public policy considerations which are rooted in the intent of Chapter 120 F.S. to create a predominantly layman's forum have been weighed in Petitioners' favor.

    
    

44. Upon reflection, common sense dictates that laymen with a narrow window of opportunity (here, 14 days in which to file their petitions) do not

    have the time to make an ideally extensive investigation. Likewise, in the analysis of whether or not laymen have made "reasonable inquiry" under Section 120.57(1)(b)5 F.S., laymen should not be held to an "ordinary prudent lawyer" or "ordinary prudent environmental expert" standard of investigation before filing. Also, nothing in the statute or case law even hints at a requirement that Petitioners must confine their reasons for filing challenges to items discovered solely in the agency (here, DEP) file(s) between the date of the publication of the Intent to Issue and the filing of their petitions. For purposes of Section 120.57(1)(b)5 F.S., Petitioners should be able to demonstrate proper purpose upon whatever they acquire to do so from whatever source they acquire it prior to the filing of their petitions, provided their theory of the case based upon those items is reasonable upon the law and the facts.

    
    

45. The other side of that coin is that they may not simply ignore all materials contrary to their theory of the case. As restated in The Corporation of the President of Jesus Christ of Latter Day Saints v. St. John's River Management District and City of Cocoa, supra., the test to be applied is, what was "reasonable [for Petitioners to do] under the circumstances?"

    
    

46. The direct evidence of Mr. Visconti and Mr. Tyde separates the case sub judice from those cases previously decided only upon circumstantial evidence.

    
    

47. Giving Petitioners every benefit of the doubt, no reasonably clear legal justification has been shown for the filing of the petitions herein. The best that can be said is that resentment over the previously finalized plant expansion construction permit, concerns unrelated to the percolation pond which was the subject of the current Notice of Intent to Issue, and unanswered questions never fully formulated and propounded clearly to DEP, led to the filing of these petitions. The Petitioners had clear knowledge that the resultant litigation would delay issuance of the NPU percolation pond permit and cause NPU to incur legal fees and costs in seeking permit approval. The legally improper purposes concluded to exist include that the Petitioners never had standing to file their petitions and never presented evidence to sustain their allegations of substantial interests within the terms of Agrico Chemical Co., Inc. v. Dept. of Environmental Regulation, 406 So2d 478 (Fla. 2d DCA 1981) and Friends of the Everglades Inc. v. Trustees, 595 So2d 186 (Fla. 1st DCA 1992); that they ignored the information they had in their possession in June, 1993 which indicated that percolation at NPU's site was excellent and that 5.6 gpd2 was the applicable loading rate for the site; that both Petitioners knew before filing their Petitions that the 1991 permit proceeding was final and that NPU had expended considerable monies in constructing the expansion allowed by the 1991 permit; that they both wanted the pre-expansion capacity of .151 MGD to be imposed retroactively on NPU's facility for their private purposes; and that litigation was begun in spite of knowledge that the proposed project was within the parameters of existing DEP rules, and in spite of some degree of familiarity with those rules. Also, they continued to press irrelevant issues up to the very day of formal hearing.

    
    

48. It is not concluded that the pleadings filed by the Petitioners' attorney at the eleventh hour were such as to subject him, individually, to Section 120.57(1)(b)5 F.S. sanctions.

Upon the foregoing findings of fact and conclusions of law, it is therefore ORDERED that:

1. NPU's motion is granted for attorney's fees in the amount of $24,690.00 and costs in the amount of $2,434.83 to be paid by Petitioners Thomas Visconti and Seabridge Civic Association, who are jointly and severally liable therefor.

   
   

2. Petitioner Visconti's counter motion for attorney's fees and costs is denied.

   
   

3. All other motions on all other attorney's fees and costs theories are denied.

   
   

4. The files of the Division of Administrative Hearings in DOAH Case Nos. 94-0082 and 94-1375 are CLOSED.

DONE AND ORDERED this 22nd day of November, 1994, at Tallahassee, Florida.

ELLA JANE P. DAVIS

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 22nd day of November, 1994.

COPIES FURNISHED:

Virginia B. Wetherell, Secretary Department of Environmental Protection Twin Towers Office Building

2600 Blair Stone Road Tallahassee, FL 32399-2400

Kenneth Plante, Esquire

Department of Environmental Protection Twin Towers Office Building

2600 Blair Stone Road Tallahassee, FL 32399-2400

Mary D. Hansen, Esquire STORCH, HANSEN & MORRIS, P.A.

Suite 300

1620 S. Clyde Morris Blvd. Daytona Beach, FL 32119

John L. Chaves, Esquire

Department of Environmental Protection 2600 Blair Stone Road

Tallahassee, FL 32399-2400

Stephen R. Ponder

114 South Palmetto Avenue Daytona Beach, FL 32114

NOTICE OF RIGHT TO JUDICIAL REVIEW

PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW PURSUANT TO SECTION 120.68, FLORIDA STATUTES. REVIEW PROCEEDINGS ARE GOVERNED BY THE FLORIDA RULES OF APPELLATE PROCEDURE. SUCH PROCEEDINGS ARE COMMENCED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF THE DIVISION OF ADMINISTRATIVE HEARINGS AND A SECOND COPY, ACCOMPANIED BY FILING FEES PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL, FIRST DISTRICT, OR WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE PARTY RESIDES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.

=================================================================

DISTRICT COURT OPINION

=================================================================

IN THE DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA FIFTH DISTRICT JANUARY TERM 1996

TOM VISCONTI, NOT FINAL UNTIL THE TIME EXPIRES TO FILE REHEARING MOTION AND

Appellant. IF FILED, DISPOSED OF

v. CASE NO. 94-2970

DOAH CASE NO. 94-0082

DEPARTMENT OF ENVIRONMENTAL PROTECTION, et al.,

Appellees.

/

Decision filed February 20, 1996

Administrative Appeal from the Department of Environmental Protection. Thomas F. Visconti, Ormond Beach, in proper person.

Mary D. Hansen of Storch, Hansen & Morris, P.A., Daytona Beach. for Appellee. PER CURIAM.

AFFIRMED.

PETERSON, C.J., DAUKSCH and COBB, JJ., concur.

MANDATE

From

DISTRICT COURT OF APPEAL OF FLORIDA FIFTH DISTRICT

This cause having been brought to this Court by Appeal, and after due consideration the Court having issued its opinion;

YOU ARE HEREBY COMMANDED that such further proceedings be had in said cause in accordance with the Opinion of this Court attached hereto and incorporated as part of this Order, and with the rules of procedure and laws of the State of Florida.

Witness the Honorable Earle W. Peterson, Jr. Chief Judge of the District Court of Appeal of the State of Florida, Fifth District, and the Seal of the said court at Daytona Beach, Florida on this day.

DATE: March 22, 1996

Fifth DCA Case No. 94-2970 (SEAL)

County of Origin: Volusia

Trial Court Case No. 94-0082 (Administrative)

FRANK J. HABERSHAW, CLERK

Docket for Case No: 94-000082

Orders for Case No: 94-000082