COALEX REPORT 146

	Coalex Report 146

This is the Office of Surface Mining's library of COALEX Research Reports. COALEX is a database of mining and reclamation information, including the Surface Mining Law and regulations, maintained in LEXIS-NEXIS -- a commercial, on-line research service. These reports have been compiled under a cooperative agreement between the Office of Surface Mining and the Interstate Mining Compact Commission, which represents most U.S. coal producing states. The following report includes an analysis of a specific issue requested by a state regulatory authority with responsibility for carrying out the Surface Mining Law. Copies of the research reports and attachments are available to the public, upon request. For additional information, or to obtain copies of the listed attachments, contact Ron Tarquinio by phone at (202) 208-2882 or by e-mail at rtarquin@osmre.gov.

                   
COALEX STATE INQUIRY REPORT - 146
July 10, 1990

Olga Bruning, Esquire
Department of Natural Resources
Tawes Building
580 Taylor Avenue
Annapolis, Maryland 21401

TOPIC: SURETY'S RIGHT TO A HEARING IN BOND FORFEITURE PROCEEDINGS

INQUIRY: When an operator has waived his right to a hearing on the forfeiture of his bond, can
the surety seek a separate hearing? Are there any state cases or administrative decisions which
discuss this issue? Are there any states which include sureties in their notice of bond forfeiture
regulations?  

SEARCH RESULTS: Research was conducted using the COALEX Library and other materials
available in LEXIS. The materials retrieved as a result of the research are discussed below. Copies
are attached.

A Wyoming case and an Interior Board of Land Appeals (IBLA) decision with fact situations similar
to those in question were retrieved. Several states were identified as having regulations which
require notice to both the surety and operator in the event of a determination to forfeit a
performance bond.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

STATE CASE LAW
ALLIED FIDELITY INSURANCE CO. v ENVIRONMENTAL QUALITY COUNCIL, 753 P2d 1038, 1988
Wyo LEXIS 52, (Wyo 1988).
   The Supreme Court of Wyoming reversed a lower court ruling in determining that a surety could
"step into the shoes of a defunct operator to request a [bond] forfeiture hearing."


IBLA DECISION
AMERICAN RESOURCES INSURANCE CO., INC., 99 IBLA 242, IBLA 87-424 (1987).  
   The Board set aside the decision to forfeit the operator's performance bond because the record
was unclear whether the surety was served with OSM's notice of determination to forfeit and "the
surety on appeal expresses its intention to reclaim the permit area". (The operator was served
with the notice and did not request a conference on the matter.)


STATE STATUTES AND REGULATIONS
   The regulations of the following states require written notification of the determination to forfeit
performance bonds to be sent, by certified mail, to both the permittee and the surety: 

Alaska
Kentucky
Maryland
Missouri
North Dakota
Ohio
Pennsylvania
Virginia
Wyoming


The regulations of these states specifically state that the operator or surety may request a
conference or hearing:

Alaska
Kentucky
North Dakota
Pennsylvania
Virginia


These states provide an opportunity for the surety to reclaim the permit area:

Ohio
Maryland
Missouri


ATTACHMENTS
A.   ALLIED FIDELITY INSURANCE CO. v ENVIRONMENTAL QUALITY COUNCIL, 753 P2d
     1038, 1988 Wyo LEXIS 52, (Wyo 1988).
B.   AMERICAN RESOURCES INSURANCE CO., INC., 99 IBLA 242, IBLA 87-424 (1987).
C.   11 ALASKA ADMIN. CODE [AAC] 90.213 (Register 86, 1983).
D.   405 KENTUCKY ADMIN. REGS. [KAR] 10:050E (1981).  
E.   ANNOTATED CODE OF MARYLAND title 7, Sec. 7-6A-22 (1979).
F.   10 MISSOURI CODE OF STATE REGS. [CSR] 40-7.031 (1987).
G.   NORTH DAKOTA ADMIN. CODE Sec. 69-05.2-12-16 (1987).
H.   OHIO COAL MINING AND RECLAMATION LAW, Sec. 1513.16 (1986).
I.   OHIO ADMIN. CODE Sec. 1501:13-7-06 (1986).
J.   PENNSYLVANIA Dept. of Environmental Resources Coal Mining Regulations, Title 25, Sec.
     86.182 (1982).
K.   VIRGINIA Dept. of Mines, Minerals and Energy, Div. of Mined Land Reclamation, Coal
     Surface Mining Reclamation Regulations, Sec. 480-03-19.800.51 (1985).
L.   WYOMING STAT. SEC. 35-11-421 (1973).


Research conducted by: Joyce Zweben Scall

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