18 ELR 21020 -- State v. Diamond International Corp.

State v. Diamond International Corp.

No. 86-E-1 (N.H. Super. Ct. April 26, 1988)

The court holds that an action brought by New Hampshire for civil penalties for national pollutant discharge elimination system permit violations by the past and present owners of a paper mill is barred by a two-year state statute of limitations. The statute of limitations provides that all suits founded on any penal statute must be brought within two years of the commission of the offense. However, this statute of limitations was originally enacted almost a century ago to apply to qui tam actions, which were abolished in New Hampshire in 1899, and has never been held to apply in any reported case. The court holds that the language of the statute clearly and unambiguously applies to all suits based on any penal statute and that the New Hampshire Water Pollution ControlAct is a penal statute. The legislature intended the statute of limitations to apply to actions other than qui tam proceedings, since it was not repealed when qui tam actions were abolished and the statute was applied to more than qui tam actions prior to 1899. The statute of limitations does not apply only to criminal or quasi-criminal penalties, since the statute states that it applies to all actions based on any penal statute. Although the statute appears in a chapter that was originally intended to apply to minor local actions, the words of the statute are not so limited. Although the penalty provisions of the New Hampshire Water Pollution Control Act were amended to conform with the provisions of the Federal Water Pollution Control Act, which is governed by the five-year statute of limitations in 28 U.S.C. § 2462, the court assumes the legislature was aware of the existence of the two-year state statute of limitations and intended state and federal law to differ on this issue. The court observes that a longer statute of limitations for environmental enforcement would be sensible public policy, but declines to substitute its judgment for that of the legislature.

Counsel for Plaintiff
Peter G. Beeson, Ass't Attorney General
25 Capitol St., State House Annex, Concord NH 03301
(603) 271-3658

Counsel for Defendants
Thomas D. Rath
Rath & Young
Box 709, One Eagle Square, Concord NH 03301
(603) 226-2600

James A. Rogers
Skadden, Arps, Slate, Meagher & Flom
919 18th St. NW, Washington DC 20006
(202) 371-7000

[18 ELR 21020]

Dunfey, J.:

Opinion

On or about December 3, 1974, the United States Environmental Protection Agency and the State of New Hampshire issued a joint surface water discharge permit, designated as National Pollutant Discharge Elimination System (NPDES) Permit No. NH 001562, to the defendant Diamond International Corporation (hereinafter Diamond). The permit established "effluent limitations" on a number of pollutants discharged by Diamond into the Connecticut and Ammonoosuc Rivers as a result of the operation of the Groveton Paper Mill. The State of New Hampshire alleges, in a petition filed December 31, 1985, that Diamond exceeded its permit limitations between December 1979 and July 1983 on one hundred and nine (109) occasions, and that defendant James River Corporation (hereinafter James River), the current operator of the Groveton Paper Mill, exceeded the permit limitations between August 1983 and November 1985 on eighty-one (81) occasions. The State seeks civil penalties against both Diamond and James River, pursuant to the New Hampshire Water Pollution Control Act, RSA 149:19 II and III (Supp. 1987), and, additionally, seeks permanent injunctive relief against James River.

Diamond has moved to dismiss the State's petition, asserting that the alleged violations occurred more than two years prior to the date the action was filed, and that the State's petition is therefore barred by the statute of limitations set forth in RSA 616:9. James River has moved to dismiss Counts 65-69, 92-95, 150 and 181-185 on the same ground.

After a hearing on these motions, the parties filed supplemental memoranda of law, and in July of 1987 Diamond submitted a motion for leave to file an additional supplemental memorandum based upon the United States Supreme Court's decision in Tull v. United States, 107 S. Ct. 1831 [17 ELR 20667] (1987). The State did not object to the filing of this motion, but filed a memorandum in reply.

In support of their motions to dismiss, the defendants argue that RSA 616:9 is a general, "catch-all" statute of limitations which governs all penal actions for penalties and forfeitures, and further assert that since Section 19 of RSA 149 is a penal statute, it falls squarely within the purview of RSA 616:9. The defendants argue that since the language of RSA 616:9 is clear and unambiguous it would be both improper and gratuitous for the Court to consider either the legislative history of RSA 616:9 or the consequences of applying that statute to the Water Pollution Control Act.

The State asserts that RSA 616:9 is not unambiguous, and argues that the statute and its precursors were intended to apply only to qui tam actions, obsolete civil proceedings "brought by a private citizen/informer under a penal statute to collect part of the pecuniary fine provided therein." Note, "Qui Tam Actions and the Rivers and Harbors Act," 23 Case W.L. Rev. 173, 177 (1971). See also Hitchcock v. Munger, 15 N.H. 97, 103 (1844). Since the State asserts that RSA 616:9 was not intended to govern the Water Pollution Control Act, it concludes that the act is left without an express statute of limitations. This being the case, the State contends that the appropriate limitations, if any, is the five-year statute of limitations governing civil penalty actions under Section 1311 of the Clean Water Act, 33 U.S.C. § 1251, et seq., the federal statute upon which RSA 149:19 was modeled.

The question presented by this case appears, at first glance, [18 ELR 21021] to be a simple matter of statutory interpretation. The question is, in essence, whether the legislature meant what it said when it enacted RSA 616:9, providing that "[a]ll suits or prosecutions founded upon any penal statute for penalties or forfeitures shall be brought within 2 years after the commission of the offense . . ." (emphasis added). Although the general rule in such a case is that the words of a statute are given their literal meaning (see In re Russell C., 120 N.H. 260, 264 (1980); see also State v. Slayton, 116 N.H. 613, 615 (1976)) this case is problematic because RSA 616:9 is the latest version of an ancient statute of limitations. (An Act Limiting Suits on Penal Statutes, passed January 26, 1790, Laws of New Hampshire, Vol. 5, First Constitutional Period, 1784-92 at 505), which was originally intended to apply to qui tam actions. These actions were abolished in New Hampshire in 1899 (Laws 1899, ch. 31, sec. 1), and since that time neither RSA 616:9 nor its precursors have been held to apply in any reported case. See In re $ 207,523.46 in United States Currency, No. 86-143, Slip op. at 5 (N.H. December 31, 1987) (requirement that suit be brought within two years after commission of offense not applicable to forfeitures based upon a demonstration of intended activity under RSA 318-B:17-b, "Forfeiture of Items Used in Connection with Drug Offense"); LeWitt v. Warner Brothers Pictures Distributing Corp., 158 F. Supp. 307, 308 (D.N.H. 1957) (treble damage suits under federal anti-trust laws not subject to RSA 616:9); State v. McConnell, 70 N.H. 158 (1899) (subsequent to repeal of qui tam proceedings, the former qui tam statute of limitations, P.S. Ch. 257, sec. 10 and 11, does not postpone for one year the time in which an indictment upon a penal statute may be brought).

RSA 616:9 has existed in its present form for almost a century, see P.L. Ch. 371, sec. 9; State's Memorandum in Opposition to Defendants' Motions to Dismiss, pp. 11-15, but in spite of its comprehensive language, the statute has apparently suffered from utter neglect. The Court is now faced with the difficult task of determining whether this ancient and neglected statute of limitations may be resurrected to bar a proceeding initiated under the environmental laws of this State, laws which did not exist, and which were uncontemplated, a century ago.

In addressing any question of statutory interpretation, the Court is guided by certain well-established rules of statutory construction. The most basic of these rules is that, in determining the meaning of a statute, the Court must look first to the language of the statute itself, see Psychiatric Institute of America v. Mediplex, Inc., No. 86-327, Slip op. at 4 (N.H. December 4, 1987), the words in a statute being the touchstone of the legislature's intention. Greenhalge v. Town of Dunbarton, 122 N.H. 1038, 1040 (1982). In interpreting this language, the Court may not speculate upon any supposed legislative intent not appropriately expressed in the language of the act itself. Corson v. Brown Products, Inc., 119 N.H. 20, 23 (1979), app. after rm'd 120 N.H. 665 (1979); see Hamby v. Adams, 117 N.H. 606, 609 (1977).

RSA 616:9 contains the sweeping statement that its two-year period of limitation applies to "[a]ll suits . . . founded upon any penal statute for penalties or forfeitures . . ." (emphasis added). If this statement is clear and unambiguous, the Court will not resort to an inspection of the statute's legislative history in an effort to ascertain the meaning of the words, see State v. Hart, No. 86-467, Slip op. at 2 (N.H. March 10, 1988); In re Richard M., 127 N.H. 12, 17 (1985). Rather, the Court will accept the plain import of the words, and apply the statute as written. See Concord Steam Corp. v. City of Concord, 128 N.H. 724, 729 (1986).

Like most rules of statutory interpretation, there are exceptions to the rule expressed above. It has been noted that the Court must give statutory language its literal meaning unless "it appears from the context of the statute that a different meaning was intended, Town of Londonderry v. Faucher, 112 N.H. 454, 457 . . . (1972), or if to do so would be inconsistent with the general purpose of the statute. Blais v. Town of Goffstown, 119 N.H. 613, 616 . . . (1979)." In re Russell C., supra at 264. There may also be "grave reason to doubt whether the literal sense is the sense intended by the legislature" if "the literal meaning of the particular words is inconsistent with . . . a well settled principle of law of general application. . . ." Quimby v. Woodbury, 63 N.H. 370, 374 (1885).

Some of the exceptions to the rule of literal interpretation may give rise to circular analysis. It is, for example, necessary to consult the legislative and judicial history of a statute in order to determine its "general purpose." The Court's goal in determining the "general purpose" is to ascertain whether a literal interpretation should be applied, or whether the legislative history should be consulted. In other words, it may be necessary to consult the history of a statute in order to determine if the history should be consulted. The Court has, therefore, inspected the language of RSA 616:9, the legislative and judicial history of the statute, and the cases relating to the rule of literal interpretation and its exceptions in an effort to ascertain whether RSA 616:9 was intended to apply to RSA 149:19.

Initially, the Court concludes that the language of RSA 616:9 is clear and unambiguous. Cf. In re $ 207,523.46 in United States Currency, supra (intimating that RSA 616:9 is inapplicable to RSA 318-B:17-b, not because of any ambiguity in the statute, but because RSA 616:9 does not, on its face, apply to demonstrations of intended activity). The plain import of the statutory language is that RSA 616:9 applies to all suits based upon any penal statute for penalties or forfeitures, and there can be little doubt that RSA 149:19 is such a penalty statute. See 3 Singer, SUTHERLAND STATUTORY CONSTRUCTION, Sec. 59.01 (4th Ed., 1986); see also Tull v. United States, supra.

The State argues that a literal interpretation is contrary to the purpose of RSA 616:9, which, the State contends, was originally to limit only the time in which qui tam actions could be brought. See State's Memorandum in Opposition to Defendants' Motions to Dismiss, p. 17. The Court concludes that this is not the case. In 1899, when qui tam actions were abolished in New Hampshire, the legislature did not repeal P.S. Ch. 257, sec. 10, et seq., the former qui tam statute of limitations, but rather excised all references to qui tam proceedings from that statute, creating the language of RSA 616:9 as it stands today. See State's Memorandum in Opposition to Defendants' Motion to Dismiss, pp. 11-12. The Court refuses to conclude that the legislature intended RSA 616:9 to remain as a statute of limitations applicable only to a cause of action which had been abolished. To do so would violate the rule of construction providing that the legislature "should not be presumed to do an idle or meaningless act." Kalloch v. Board of Trustees of N.H. Retirement System, 116 N.H. 443, 445 (1976). See In re N.H. Disabilities Rights Center, No. 86-192, Slip op. at 5 (N.H., March 10, 1988). Even before the abolition of the qui tam cause of action, the statutes which were the forerunners of RSA 616:9 were applied to more than qui tam actions alone. See State v. Hunkins, 43 N.H. 557 (1862); see also State v. Robinson, 29 N.H. 274 (1854). This being the case, the Court concludes that the purpose of RSA 616:9 was, and is, to provide a limitation on actions other than qui tam proceedings.

In spite of the comprehensive language of RSA 616:9, it may be argued that a literal interpretation is inappropriate because an ambiguity lies hidden within the words of the statute. RSA 616:9 arguably fails to address the question of whether it applies to "any penal statute" of any type (be it civil, criminal or quasi-criminal in nature), or whether it is intended to apply only to "any penal statute" of a particular type. It may be argued that the purpose of RSA 616:9 is to limit only actions based upon criminal or quasi-criminal penalties or forfeitures. Such an argument would not be entirely unreasonable in light of the history of the statute. Under the former qui tam statute, a private action was enforceable by any citizen for one year, but if a private citizen failed to file suit, the State was granted exclusive prosecutorial power for one additional year. The State's authority, however, was utilized only to enforce criminal or quasi-criminal penalties. State v. Nashua and Lowell Railroad, 58 N.H. 182, 183 (1877).

The defendants argue that RSA 616:9's predecessors have been applied to both criminal and civil penalties, and that RSA 616:9 therefore applies to RSA 149:19, which exacts civil penalties. In support of this argument, the defendants contend that the two-year limitation has been applied in usury cases, which involve laws enforced by the aggrieved party; a standard civil action, as opposed to a qui tam action which allows any citizen to file suit. See Ashland Savings Bank v. Bailey, 66 N.H. 334 (1890); Baker v. Strafford County Savings Bank, 61 N.H. 147 (1881). For the purposes of the present inquiry, however, the Court is concerned with the substance of the action, not its form. See Roberts v. Richard & Sons, Inc., 113 N.H. 154, 156 (1973). Regardless of who may institute the cause of action, the substantive claim of usury stands out as the quintessential [18 ELR 21022] qui tam action: a civil action brought by a private citizen to collect part of a pecuniary fine. The defendants' distinction between an aggrieved private citizen and any private citizen does not transform a qui tam action into something else. Thus, it appears that the defendants would be unable to demonstrate that RSA 616:9 or its predecessors have ever been applied to anything but qui tam actions, or criminal or quasi-criminal actions for penalties or forfeitures. Indeed, the most recent case addressing RSA 616:9, In re $ 207,523.46 in United States Currency, supra, also arises in the criminal context. That case deals with a forfeiture under RSA 318-B:17-b, "Forfeiture of Items Used in Connection With Drug Offense." While such forfeiture proceedings are initiated by the filing of a suit in equity, RSA 318-B:17-b IV, the proceedings nonetheless arise as the result of a violation of the State's Criminal Code. No such violation of the Code underlies the instant civil penalty action. See RSA 149:19 II.

While the argument that RSA 616:9 applies only to criminal or quasi-criminal penalties may appear compelling, its force is diminished by one simple fact: the language of the statute indicates that it applies to all actions based upon any penal statute. The statute is clear. For the court to "read in" an ambiguity would be inappropriate, since "construing a statute liberally and adding to it, by judicial fiat, a provision which the legislature did not see fit to include are not one in the same thing." Amalgamated Insurance Co. v. Helms, 212 A.2d 311, 315 (Md. Ct. App. 1965). In short, the Court refuses to resort to outside sources in an effort to find an ambiguity within an otherwise clear statute, see Private Truck Council of America v. State, 128 N.H. 466, 474 (1986), and the Court will not "speculate upon any supposed legislative intent not appropriately expressed in the language of the act itself." Corson v. Brown Products, Inc., supra at 23. See Trustees of Phillips Exeter Academy v. Exeter, 92 N.H. 473, 478 (1943). The Court therefore concludes that a literal interpretation of RSA 616:9 is not inconsistent with the general purpose of the statute, In re Russell C., supra at 264.

The Court also finds no reason to resort to the exception to the rule of literal interpretation which states that a literal reading may be inappropriate if "it appears from the context of the statute that a different meaning was intended." Id. An inspection of Chapter 616 as a whole reveals that, originally, the Chapter may have been intended to enforce a variety of minor penalty and forfeiture actions brought by local prosecutors on behalf of towns and counties. See RSA 616:2 through 616:7; see also State's Memorandum in Opposition to Defendants' Motions to Dismiss, p. 6. While the overall context of Chapter 616 appears to limit certain provisions of that chapter to minor local actions, the words of RSA 616:9 in specific are not so limited. Furthermore, regardless of whether the Chapter may once have been limited to minor local proceedings, RSA 616:9 does not now appear to be limited by its placement within Chapter 616. Indeed, the most recent case addressing RSA 616:9, In re $ 207,523.46 in United States Currency, supra, appears to suggest that, in the proper case, RSA 616:9 may be applied against the State in a major forfeiture proceeding. Id. at 5. This being the case, the context of RSA 616:9 fails to suggest that a literal reading of the statute is inappropriate.

The Court has also been unable to ascertain any "well settled principle of law of general application . . .," Quimby v. Woodbury, supra at 374, which is inconsistent with a literal reading of RSA 616:9. Although there exists a principle of law which states that, unless otherwise specifically provided, an action brought by the State government will not be barred by the passage of time, see In re Dockham's Estate, 108 N.H. 80, 81 (1967); Reconstruction Finance Corporation v. Faulkner, 100 N.H. 192, 193 (1956); WOOD ON LIMITATIONS, Sec. 52 (4th ed. 1916), RSA 616:9 provides precisely the type of limitation contemplated by the general rule.

The Court has located only one line of cases which diverges from the rule of literal interpretation in the case of unambiguity. That line of cases involves the so-called "dog-bite statutes." In Blais v. Town of Goffstown, supra, the Court dealt with a statute, RSA 466:19, which, when read literally, provided a cause of action against any person who owned or kept a dog. The issue in Blais was whether this century-old statute could be applied to suits against municipalities for injuries suffered as the result of the reasonable use of police dogs. In spite of the comprehensive language of RSA 466:19, the Court nonetheless concluded that the "critical question . . . [was] . . . whether the legislature intended that municipalities employing police dogs be within the purview of the act." Id. at 616.

Although the Court in Blais concluded that "it would be less than reasonable to believe that in 1851, when to our knowledge municipal police forces were not using attack dogs, the legislature intended to include municipal owners of police dogs within the definition of an 'owner or keeper of [a] dog,'" id. at 617, the Court's conclusion appears to have been based upon the unique judicial history of the "dog-bite statutes." See, e.g., Orne v. Roberts, 51 N.H. 110 (1871); Quimby v. Woodbury, 63 N.H. 370 (1885); Gagnon v. Frank, 83 N.H. 122 (1927); Noyes v. Labrecque, 106 N.H. 357 (1965). A judicial gloss has apparently been added to RSA 466:19, requiring that the statute be interpreted so as not to confer a right of action upon all persons indiscriminately. Gagnon v. Frank, supra at 123. No such judicial gloss exists in regard to RSA 616:9. Additionally, the Blais decision appears to fall squarely within the rule that literal interpretation is inappropriate if inconsistent with a well settled law of general application. See Quimby v. Woodbury, supra at 374; Blais v. Town of Goffstown, supra at 617-18. For these reasons, Blais is inapposite to the instant situation. This being the case, it would not be unreasonable to conclude that the legislature enacted the current version of RSA 616:9 in anticipation that it would be applied to actions not yet extant at the time of the effective date of the statute, see Innie v. W & R, Inc., 116 N.H. 315, 318 (1976). In essence, it appears that RSA 616:9, unlike RSA 466:19, was intended as a comprehensive "catch-all" statute.

While the Court could conclude that RSA 616:9 is inapplicable to RSA 149:19 on the basis of the foregoing analysis alone, the implications of this decision prompt discussion of an additional concern. On June 15, 1973, the House Committee on Resources and Environmental Control conducted hearings relative to the need to amend RSA 149:19, the State's Water Polluton Control Act. Mr. William Healy, Director of the Water Supply and Pollution Control Committee, and Mr. Donald Stever, Esquire, of the Attorney General's office, testified that the proposed amendments to RSA 149:19 were drafted in response to changes in the federal Clean Water Act, 33 U.S.C. section 1342, and were necessary in order to insure proper State enforcement of the NPDES permit program. See State's Exhibit B, pp. 1-2. More specifically, the testimony reveals that the penalty provisions were amended at the request of the EPA "to agree with [the] penalties in [the] federal act." Id., at p. 4.

The penalty provisions of the federal Clean Water Act are governed by the five-year limitation period set forth in 28 U.S.C. section 2462. That provision does not appear in the Clean Water Act itself, but, rather, is a general, "catch-all" limitation provision set forth in an entirely different portion of the Code. This being the case, the State would have the Court conclude that the New Hampshire legislature desired the five-year limitation of 28 U.S.C. section 2462 to apply to State environmental actions, but that the legislature overlooked that provision and forgot about the long-neglected two-year limitation of RSA 616:9. This the Court refuses to do. The Court will assume that the legislature was aware of the existence of RSA 616:9 (see Mathewson v. Contributory Retirement Board, 141 N.E.2d 522, 525 (Mass. 1957); 2A Singer, SUTHERLAND ON STATUTORY CONSTRUCTION, sec. 45.12 (4th Ed. 1986)) and was aware that this statute would govern actions under the amended RSA 149:19. Even if the vague and unexpressed intent of the legislature was to bring State environmental law into conformance with federal law, it is possible that the legislature determined that, in regard to the period of limitation, federal and state law should differ.

If the legislature desired a five-year limitation to apply, it did not act upon that desire. Since the intent of the legislature is to be found, not in what the legislature might have intended, but in the meaning of what it actually said (Corson v. Brown Products, supra at 23) the question for the Court is not simply what the legislature may have desired, but rather what intention it has actually expressed. Bailey v. Mars, 87 A.2d 388, 390 (Conn. 1952). In this case, that legislative expression leads to the inescapable conclusion that RSA 616:9 is the appropriate limitation for actions under RSA 149:19, and that no implied repeal of RSA 616:9 may be found. See Arnold v. City of Manchester, 119 N.H. 859, 863 (1979).

The Court is aware that a statute of limitations of more than [18 ELR 21023] two years for environmental actions may be supported by sensible public policy. The complex investigations required for pollution enforcement are better suited to a longer period of limitations, since the physical and environmental effects of pollution are often not discoverable until months, and sometimes years, after the pollution actually occurs. As this case indicates, investigators need time to collect field and laboratory data in order to determine the extent of the violation. Discovery and investigation may often take more than two years. Nonetheless, the Court is cognizant of its own proper function. It is axiomatic that the judiciary may not substitute its own judgment for that of the legislature in matters of public policy. 1 Singer, SUTHERLAND STATUTORY CONSTRUCTION, sec. 2.01 (4th Ed. 1986); see Trustees of Phillips Exeter Academy v. Exeter, supra at 478. It is possible that the legislature considered the problems created by a short period of limitations and determined that it nonetheless wished to advance a policy of speedy prosecution. It is certainly not clear that the purpose of RSA 149:19 would be "nullif[ied] to an appreciable extent" by the application of a short limitation period to State environmental actions. See State v. Kay, 115 N.H. 696, 698 (1975).

In conclusion, the Court notes that if RSA 616:9 did not govern RSA 149:19, it is clear that the New Hampshire Water Pollution Control Act would be governed by no other statute of limitations. Environmental actions under RSA 149:19 could be initiated years, and even decades, after a violation occurred. This would not necessarily violate any general principle of law, since time does not usually run against the sovereign, absent an express limitation. See In re Dockham's Estate, supra; Reconstruction Finance Corp. v Faulkner, supra; WOOD ON LIMITATIONS, sec. 52 (4th Ed. 1916); see also United States v. Mottolo, 605 F. Supp. 898 [15 ELR 20444] (D.N.H. 1985) (holding that no statute of limitations is applicable to cost reimbursement actions brought by the State under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. sec. 9607(a)). As the defendants have argued, absent a statute of limitations, and absent any limitation imposed by the doctrine of laches, the State would be free to recover from violators of the Water Pollution Control Act "penalties that accrue at the rate of up to $ 10,000 per day . . . for an unlimited period of time beginning with the first violation, and ending only when the State cho[oses] to file suit." Diamond International's Supplemental Memorandum of Law in Support of its Motion to Dismiss, p. 8. While this may be labeled unfair by the defendants, and while the Court may refrain from interpreting a statute so as to produce an unjust result (Matter of Sargent, 116 N.H. 77, 82 (1976)) the Court notes that it is not certain that the absence of a limitation in this case would necessarily prove unjust. In any event, the Court is inclined to apply the clear meaning of the statute regardless of the consequences, see Trustees of Phillips Exeter Academy v. Exeter, supra at 478; Naum v. Naum, 101 N.H. 367, 369 (1958).

For the foregoing reasons, defendant Diamond International's Motion to Dismiss is GRANTED.

The defendant James River's Motion to Dismiss is GRANTED only as it pertains to Counts 65-69, 92-95, 150 and 181-185.

The other violations alleged by the State in this proceeding remain unaffected by this decision.

So Ordered.