The U.S. Supreme Court issued its most anticipated decision in the environmental arena this term in Sackett v. U.S. Environmental Protection Agency - a case that has been dubbed a sort of David vs. Goliath battle by property rights advocates - finding in favor of the landowner and against EPA.
The basic facts of Sackett are relatively straight-forward: the Sacketts owned a residential lot near Priest Lake, Idaho and were preparing to build a home there. After they performed grading and fill work at the site, EPA officials served the couple with an administrative compliance order advising them that their parcel constituted wetlands subject to federal permit jurisdiction under section 404 of the Clean Water Act. The order directed the Sacketts to restore the lot to its original condition without delay; and threatened the Sacketts with substantial daily fines (quantified by the Solicitor General at oral argument as up to $75,000/day) for non-compliance with the CWA and administrative order.
The landowners then sought a hearing to make their case that the property was not actually a wetland. This request was denied and the Sacketts filed suit in federal district court to challenge EPA’s wetlands classification of their lot. The district court dismissed their lawsuit, holding that EPA administrative compliance orders issued under the CWA do not constitute final agency actions subject to judicial review. The Ninth Circuit affirmed, joining numerous other federal circuits that had previously come to the same conclusion.
The Supreme Court disagreed, holding that a compliance order issued under the CWA is final agency action under the APA and subject to judicial review. The Supreme Court did not reach the issue of whether EPA violated the Sacketts' due process rights by depriving them of the opportunity for judicial review. Had the Court reached this issue, it would likely have had impacts on administrative law far beyond the wetlands context. Instead, the Court restricted its opinion to the question of whether the administrative compliance order was a final agency action, and found that it was.
This decision will likely make life more difficult for EPA regulators, requiring the agency often to engage in costly litigation before actual compliance with its administrative orders is required. But a system in which EPA can use the threat of significant daily fines in order to force compliance without the landowners having any opportunity for judicial review is inequitable and was in need of fixing. Judicial review should also reduce waste in many cases because it will allow courts to decide disputed issues before the landowner is required to pay significant compliance costs. This is particularly important when the issue, as in Sackett, is whether EPA has jurisdiction over the site at all. Presumably the availability of judicial review will also make EPA think twice before denying a request for a hearing from a landowner.The full opinion of Sackett v. EPA can be found at http://pub.bna.com/lw/101062.pdf.
Dan Cory regularly blogs on The Monitoring Well.