Docket No. 80-1920

BRANCIFORTE BUILDERS, INC.

OSHRC Docket No. 80-1920

Occupational Safety and Health Review Commission

July 31, 1981

[*1]

Before: CLEARY and COTTINE, Commissioners.

COUNSEL:

Office of the Solicitor, USDOL

Francis V. LaRuffa, Regional Solicitor, U.S. Department of Labor

Anthony N. Arico, for the employer

OPINION:

DECISION

BY THE COMMISSION:

A decision of Administrative Law Judge Wallace Tannenbaum is before the Commission for review pursuant to section 12(j), 29 U.S.C. § 661(i), of the Occupational Safety and Health Act of 1970, 29 U.S.C. § § 651-678 ("the Act"). Judge Tannenbaum dismissed the notice of contest of Respondent, Branciforte Builders, Inc., as untimely, finding that the citations issued to Respondent had become final orders under section 10(a) of the Act n1 and, as such, were beyond the Commission's jurisdiction. Respondent petitioned for review of the judge's decision and review was granted by former Commissioner Barnako. The only issue before the Commission is whether the judge erred in dismissing Respondent's notice of contest as untimely.

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n1 Section 10(a), 29 U.S.C. § 659(a), provides in pertinent part:

If, within fifteen working days from the receipt of the notice issued by the Secretary the employer fails to notify the Secretary that he intends to contest the citation or proposed assessment of penalty, and no notice is filed by any employee or representative of employees under subsection (c) within such time, the citation and the assessment, as proposed, shall be deemed a final order of the Commission and not subject to review by any court or agency.

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On January 4, 1980, the Occupational Safety and Health Administration ("OSHA"), acting on behalf of the Secretary of Labor ("the Secretary"), issued three multi-itemed citations to Respondent alleging that it had committed serious, repeated, and other-than-serious violations of the Act at a New Brunswick, New Jersey, construction site. OSHA proposed penalties totaling $17,085 for the alleged violations. Respondent received the citations and notices of proposed penalties on January 8, 1980. n2 On February 6, 1980, James Conlon, area director of OSHA's Belle Meade, New Jersey office, informed Respondent by letter that, since the fifteen working day period for filing a notice of contest had expired and a notice of contest had not been filed, the citations and proposed penalties had become final orders of the Commission and Respondent was required to pay $17,085 in penalties. As shown by the return receipt, Respondent's employee, Walter DeRiso, received and signed for this letter from Area Director Conlon on February 11, 1980.

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n2 Pursuant to section 10(a) of the Act, the Secretary is required to notify an employer by certified mail if a citation has been issued or penalty proposed for an alleged violation. The date of the employer's receipt of the certified letter is recorded on a return receipt that is signed by a representative of the employer and subsequently returned to the Secretary. In this case, OSHA mailed the citations and notices of proposed penalties to Respondent's home office and sent a duplicate set to the cited worksite, both by certified mail. Both sets were addressed to the attention of Louis Branciforte, Respondent's president. Both the jobsite and Respondent's home office were located in New Brunswick, New Jersey. The return receipts show that Walter DeRiso, Respondent's employee, received and signed for both sets of citations and notices of proposed penalties on January 8, 1980.

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On March 31, 1980, the Executive Secretary of the Commission received from Respondent's counsel a letter dated March 12, 1980, in which Respondent conceded that it failed to file a timely notice of contest but [*4] requested leave to file a notice of contest "as within time to afford it an opportunity to contest this matter." The case was docketed by the Commission and assigned to Judge Tannenbaum.

At the hearing before Judge Tannenbaum, Area Director Conlon testified that he received a letter from Ralph Palazzo, a representative of Respondent, dated February 11, 1980, informing him that "there has been little activity" at the inspected jobsite and that construction would resume "within several weeks." In order to determine whether this letter was intended to be a notice of contest, Conlon telephoned Palazzo. According to Conlon, Palazzo stated that the letter was to inform Conlon that "the job was shut down." Palazzo also told Conlon to speak with Luigi Branciforte, Respondent's president, in order to determine whether the February 11, 1980 letter was intended to serve as Respondent's notice of contest. Conlon testified that in a subsequent telephone conversation Branciforte reiterated that Respondent "had no men on the job" at that time but acknowledged that Respondent's shop steward was at the worksite at the time of the alleged violation. Branciforte did not further clarify the purpose [*5] of Palazzo's February 11th letter. In his testimony, Conlon noted that Respondent had been cited on prior occasions for alleged violations of the Act and, in at least three instances, had timely contested the citation and notice of proposed penalty. These notices of contest were placed in evidence by the Secretary.

Anthony Arico, counsel for Respondent, conceded that Respondent received the citation on January 8, 1980, and stipulated that Respondent failed to file a timely notice of contest. Arico also testified in Respondent's behalf at the hearing. In his testimony, Arico stated that he did not know whether the February 11, 1980 letter from Palazzo constituted a notice of contest. According to Arico, in late February or early March Conlon informed him that Conlon had no authority to extend the fifteen day filing period but recommended that Arico contact the Executive Secretary of the Review Commission. Arico further testified that on March 12, 1980, he filed the notice of contest that was docketed by the Executive Secretary of the Review Commission.

Luigi Branciforte, Respondent's president, testified that he did not personally become aware that his company had been issued [*6] the citations and notices of proposed penalties in question until he was informed by his secretary that he would have to pay the $17,085 in penalties to OSHA. Apparently he was informed of this after his firm received the letter from OSHA requesting payment of the total penalty. Branciforte testified that DeRiso, the employee who received and signed for the citations and notices of proposed penalties, was a 72 year-old man who performed minor tasks in Respondent's office. Branciforte further testified that at the time of receipt of the citations and notices of proposed penalties, he was very sick and was having a nervous breakdown. Branciforte did not elaborate on the severity of his illness or on the extent to which his illness prevented him from performing his normal corporate duties. According to Branciforte, other than himself, there were no corporate officers in Respondent's office; only Branciforte, his son, two "girls" and two engineers worked in the office.

In his decision Judge Tannenbaum found that Respondent's notice of contest was untimely filed. Applying B.J. Hughes, Inc., 79 OSAHRC 49/E6, 7 BNA OSHC 1471, 1979 CCH OSHD P23,675 (No. 76-2165, 1979), the [*7] judge determined that Respondent's failure to file a timely notice of contest could not be excused, since there was no evidence that the Respondent's late filing resulted from the erroneous representations of the Secretary or his representative. He thus concluded that the citations and notices of penalties issued to Respondent were final orders not subject to the Commission's review.

III

On review, the Commission finds that the judge correctly determined that Respondent's notice of contest was untimely and that this late filing was not caused by the representations or conduct of the Secretary. At the hearing Respondent conceded that it failed to file a notice of contest within fifteen working days of its receipt of the citations and notices of proposed penalties on January 8, 1980. Moreover, there is no evidence that Respondent was misled by the Secretary or his representatives as to the deadline for filing a timely notice of contest.

Before the judge, Respondent argued that its untimely filing should be excused because the Secretary was not prejudiced by the delay and because Respondent proceeded in good faith in filing its late notice of contest. Respondent also contended [*8] that by docketing this case, the Executive Secretary of the Review Commission waived the filing requirement of section 10(a).

Respondent's arguments are not persuasive. In Fitchburg Foundry, Inc., 79 OSAHRC 50/A2, 7 BNA OSHC 1516, 1979 CCH OSHD P23,686 (No. 77-520, 1979), the Commission held that prejudice to the Secretary is not a factor to be considered in determining whether a notice of contest has been timely filed and that good faith alone does not warrant an extension of the statutory filing period. Additionally, the Commission's docketing of a case and its assignment to an administrative law judge does not constitute a waiver of the fifteen day contest period. Norkin Plumbing Co., 77 OSAHRC 192/C9, 5 BNA OSHC 2062, 1977-78 CCH OSHD P22,296 (No. 76-4316, 1977). n3

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n3 As indicated in Norkin Plumbing Co., a question regarding to timeliness of a notice of contest presents a legal issue that requires a judicial determination. By docketing an apparently late notice of contest, the Commission merely provides a forum in which the timeliness of the notice of contest may br adjudicated.

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The February 11, 1980 letter from Palazzo cannot be construed as Respondent's notice of contest. Although writings submitted by Respondent during the period in which it may contest a citation are to be given liberal interpretation, Eastern Knitting Mills, Inc., 74 OSAHRC 82/A2, 1 BNA OSHC 1677, 1973-74 CCH OSHD P17,691 (No. 2019, 1974), in the present case the Commission is unable to find any basis for concluding that Palazzo's letter served as Respondent's notice of contest. The letter was not sent during the contest period. Moreover, neither Branciforte nor the letter's author, Palazzo, ever asserted that the letter was intended to be a notice of contest. Cf. Maxwell Wirebound Box Co., 80 OSAHRC 84/D11, 8 BNA OSHC 1995, 1980 CCH OSHD P24,758 (No. 15965, 1980) (pleadings and communications subsequent to the filing of an apparently limited notice of contest established Respondent's intent to fully contest citation and notice of proposed penalty); Turnbull Millwork Co., 75 OSAHRC 16/A13, 3 BNA OSHC 1781, 1975-76 CCH OSHD P20,221 (No. 7413, 1975) (same). Indeed, at the hearing, Respondent's [*10] counsel took no position as to whether this letter was intended to serve as a notice of contest. Thus, neither the substance of the letter nor the explanations of it given by Respondent's witnesses indicate that the letter was a notice of contest.

Even though we reject Respondent's arguments, there is an additional aspect of this case that must be considered. In J.I. Hass Co. v. OSHRC, No. 80-2017 (3d Cir. May 7, 1981), decided after the judge's decision in this case, the Third Circuit held that the Commission has jurisdiction to entertain a late notice of contest under Federal Rule of Civil Procedure 60(b). n4 Some years ago in Plessey, Inc., 74 OSAHRC 77/C1, 2 BNA OSHC 1302, 1974-75 CCH OSHD P18,907 (No. 946, 1974), the Commission held that it could apply Rule 60(b) to modify a decision and order of an administrative law judge that became final pursuant to section 12(j) of the Act, n5 but it could not grant Rule 60(b) relief to modify a citation and penalty that became a final order pursuant to section 10(a) of the Act. In holding that it could not provide Rule 60(b) relief to modify such an order, the Commission stated that, since the employer failed to file a timely [*11] notice of contest, the Commission did not have subject-matter jurisdiction and, thus, was barred by the express language of section 10(a) from affording relief.

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n4 Rule 60(b) provides in pertinent part:

Rule 60. Relief From Judgment or Order.

(b) MISTAKES; INADVERTENCE; EXCUSABLE NEGLECT; NEWLY DISCOVERED EVIDENCE; FRAUD, ETC. On motion and upon such terms as are just, the court may relieve a party or his legal representative from a final judgment, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(b); (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party; (4) the judgment is void; (5) the judgment has been satisfied, released, or discharged, or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or (6) any other reason justifying relief from the operation of the judgment. The motion shall be made within a reasonable time, and for reasons (1), (2), and (3) not more than one year after the judgment, order, or proceeding was entered or taken. A motion under this subdivision (b) does not affect the finality of a judgment or suspend its operation.

n5 In Brennan v. OSHRC (S.J. Otinger, jr., Constr. Co.), 502 F.2d 30 (5th Cir. 1974), the Fifth Circuit held that the Commission lacked the authority to reconsider a final order under Rule 60(b) after the expiration of the 30-day review period of section 12(j). In Monroe & Sons, Inc., 77 OSAHRC 14/B7, 4 BNA OSHC 2016, 1976-77 CCH OSHD P21,470 (No. 6031, 1977), the Commission declined to follow Otinger and applied Rule 60(b) to reconsider an order that had become final pursuant to section 12(j). The Sixth Circuit affirmed the Commission's application of Rule 60(b). Marshall v. Monroe & Sons, Inc., 615 F.2d 1156 (6th Cir. 1980).

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In Atlantic Marine, Inc. v. OSHRC, 524 F.2d 476 (5th Cir. 1975), the Fifth Circuit, when confronted with a late-filed notice of contest, suggested that the finality provision of section 10 of the Act, 29 U.S.C. § 659, was not an "impenetrable barrier" to Commission review of a final order. n6 The Court further suggested that an employer should not be denied review for failure to file a notice of contest within the statutory fifteen day limit of the Secretary's deception or failure to follow proper procedures is responsible for the late filing.

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n6 The finality provision at issue in Atlantic Marine, Inc. was contained in § 10(b) of the Act. Section 10(b) provides, in pertinent part, that an employer must notify the Secretary within fifteen working days if he intends to contest a notification of failure to correct a violation for which a citation had previously been issued. If an employer fails to notify the Secretary, the notification and assessment of penalty, as proposed, become a final order of the Commission and not subject to review by any court or agency. The language of the finality provision of § 10(b) is identical to that contained in § 10(a), which concerns contests of citations rather than "failure to correct" notifications.

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Subsequently, the Commission held that an employer's failure to contest a citation within the fifteen day filing period of section 10(a) was excused when the delay in filing was caused by the Secretary's deception or failure to follow proper procedures. B.J. Hughes, Inc., 79 OSAHRC 49/E6, 7 BNA OSHC 1471, 1979 CCH OSHD P23,675 (No. 76-2165, 1979); Keppel's, Inc., 79 OSAHRC 43/A2, 7 BNA OSHC 1442, 1979 CCH OSHD P23,622 (No. 77-3020, 1979). The Commission's holding in B.J. Hughes was implicitly grounded on the same equitable principles embodied in Rule 60(b)(3), which permits a court to vacate a final order for fraud, misrepresentation, or other misconduct of an adverse party. Thus, section 10(a) does not in all cases present an "impenetrable barrier" to Commission jurisdiction over a citation when the notice of contest is untimely. To the extent that Plessey, Inc. held that the Commission lacked authority to reconsider a section 10(a) final order, that decision is overruled. Accordingly, the Commission agrees with the Third Circuit's holding in J.I. Hass Co. v. OSHRC that, in [*14] cases where an employer files a late notice of contest, the employer may be granted relief from the final order under the terms of Rule 60(b).

The record in this case is incomplete and the Commission therefore is unable to determine whether Respondent is entitled to relief pursuant to Rule 60(b). It is possible, however, that Respondent's untimely notice of contest may be excused under subsections (1) or (6) of Rule 60(b). Under Rule 60(b)(1), a final judgment or order may be vacated when it is shown that the final judgment or order was entered because of "mistake, inadvertence, surprise, or excusable neglect." n7 Thus, a judgment may be vacated when it is shown that the party against whom a judgment was entered had no actual knowledge of the service of process on him due to a mistake of fact, inadvertence or excusable neglect. Rooks v. American Brass Co., 263 F.2d 166 (6th Cir. 1959). Under Rule 60(b)(6), a final judgment may be vacated for "any other reason justifying relief from the operation of the judgment." Applying Rule 60(b)(6), courts have set aside a final judgment or order when circumstances such as absence, illness, or a similar disability prevent a party from [*15] acting to protect its interests. Rooks v. American Brass Co., supra; see Klapprott v. United States, 335 U.S. 601 (1949); Pierre v. Bernuth, Lembcke Co., 20 F.R.D. 116 (S.D.N.Y. 1956).

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n7 In Marshall v. Monroe & Sons, Inc., note 5 supra, the Sixth Circuit admonished the Commission to make a careful determination as to the presence of these requirements when applying Rule 60(b)(1).

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As shown by its timely notices of contest in past Commission proceedings, Respondent was aware of the fifteen day filing deadline imposed by section 10(a). However, because of the scant evidence presented at the hearing on the issue of affording relief under Rule 60(b), this case is remanded to the judge so that further evidence may be presented on this issue. n8

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n8 A remand is appropriate also because, at the time of the hearing in this matter, Plessey, Inc., supra, was controlling on the issue of the applicability of Fed. R. Civ. P. 60(b) to section 10(a) final orders. In view of the present decision to apply Fed. R. Civ. P. 60(b) to such orders, a remand will allow both parties to present additional evidence as well as allow the judge to evaluate this evidence in light of the foregoing discussion of this rule. See Trinity Indus., Inc., 81 OSAHRC , 9 BNA OSHC 1515, 1519, 1981 CCH OSHD P25,297 at p.31,322-31,323 (No. 77-3909, 1981).

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SO ORDERED.