The Houston [1st] Court of Appeals has reversed a Travis County trial court decision that overturned a Railroad Commission order granting a permit to a landfill operator.
In HR Martin County Landfill, LLC and the Railroad Commission of Texas v. John W. Mabee; Joseph Guy Mabee; J.E. and L.E. Mabee Foundation, Inc.; Edward Frank Kelton; Betty Ann Kelton Howell; Jeffrey M. Johnston; and Sandra K. Johnston (No. 01-23-00036-CV; January 31, 2024), the landfill applied for a permit from the Texas Railroad Commission to build and operate a commercial facility for the disposal of oil and gas waste. Nearby property owners protested, arguing against the permit because the proposed site would sit over the Ogallala Aquifer recharge zone and could potentially pollute a primary water source for the region. The contested case hearing focused on the details of the proposal and included the testimony of several experts as to whether the proposed safety measures were adequate for the protection of the water source. The hearing examiners recommended denial of the permit, but the Commission granted it. Protestants sought review, asserting that permit requirements appended by the RRC outside of the case hearing would not protect the groundwater and denied them due process. The district court agreed and reversed the order for the permit. The landfill and RRC appealed.
In an opinion by Justice Landau, the court of appeals reversed and rendered judgment in favor of the landfill and agency. The court determined that the decision to grant the permit was not arbitrary because the vast majority of evidence was contained in the record of the hearing and could support approval of the permit. Additionally, the court found that the agency complied with due process and the APA since Protestants received the one required hearing to present evidence and argument. The court thus concluded that the agency’s decision to issue the permit satisfied the substantial evidence standard. The court ruled further that HR Martin’s plan to transfer control of the site to another operator did not violate operational and financial security requirements because the new operator must comply with the permit in any event.
This is an interesting case from an evidentiary standpoint. In considering whether to accept the ALJ’s recommendation to deny the permit, the agency examined of another site in the surrounding area in an effort to determine whether the permit should be granted with additional pollution control requirements. The property owners strenuously objected to this procedure, asserting that they did not have the opportunity to rebut the suitability of that particular site for an oil and gas waste landfill and further that evidence gathered by the agency from the investigation did not appear in the record. Additionally, the court cited three cases in support of its decision that, although each dealt with new requirements added by the agency following an ALJ’s recommendation to deny a permit, could be distinguished based on the type of waste involved (solid vs. liquid) or the issue of whether a significant amount of evidence in support of the permit showed up after the hearing. In any event, the court deferred to the agency’s expertise, observing its authority to accept or reject an ALJ’s recommendation based on its own experts’ analysis of the facts.
TCJL Research Intern Geneva Cline researched and substantially drafted this article.
