UNITED STATES OF AMERICA

OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION

SECRETARY OF LABOR,
Complainant,
v.	OSHRC DOCKET NO. 14822
P & Z CO., INC. and J. F. SHEA CO., INC,
Respondent.

May 21, 1976

DECISION

Before BARNAKO, Chairman; MORAN and CLEARY, Commissioners.

BY THE COMMISSION:

A December 12, 1975 report of Review Commission Judge Ben D. Worcester is before this Commission for review pursuant 661(i). By his report Judge Worcester would grant Respondent’s motion to dismiss the Secretary’s complaint and vacate his citations. For the reasons given herein, we reject the report and remand the case for a decision that comports with law.

This matter arose out of the following facts: As the result of an extensive inspection at a construction site in Washington, D. C., the Secretary issued three citations naming P & Z Co., Inc. and J. F. Shea Co., Inc. as individual Respondents. The citations alleged two serious and 29 nonserious violations of the Occupational Safety and Health Act of 1970 (29 U.S.C. 651 et seq., hereinafter ‘the Act’). A total penalty of $2,180 was proposed. The citations were timely contested by a letter in which Respondents identified themselves as ‘P & Z Co., Inc.,—J. F. Shea Co., Inc. (A Joint Venture).’ The Secretary then filed a complaint in which he sought to amend the citations by adding the joint venture to the other two named parties. The complaint was filed within six months of the date of inspection.

In response to the complaint, Respondents moved to dismiss the complaint and vacate the citations and notice of proposed penalties. In support of their motion, Respondents argued that the amendment did not give fair notice to Respondents as to which party should defend. As further grounds for their motion, Respondents contended that the inspection was invalid due to the presence of unauthorized personnel and that the citation was not issued with reasonable promptness. The Secretary opposed the motion on all grounds. Judge Worcester thereafter took oral argument and granted Respondents’ motion; he vacated the citations. He then rendered the following as his report to the Commission:

The motion of the respondent to dismiss the complaint without leave to amend is granted. It is therefore hereby ordered that the citation and proposed penalty be vacated.

The Secretary petitioned for discretionary review. Among other things, he excepted to the judge’s report for failing to give any explanation for his decision in violation of the Administrative Procedure Act and the Commission’s Rules of Procedure.

The Secretary cites § 557(c) of the Administrative Procedure Act (APA).[1] Commissioner Cleary directed review.

Section 10(c) of our Act requires the Commission to afford contesting employers the opportunity for a hearing in accordance with section 554 of the APA. Section 554(c)(2) of the APA, in turn, incorporates the requirements of section 557 of the APA regarding the contents of decisions issued by an administrative agency. Section 557(c) provides in pertinent part:

All decisions, including initial, recommended, and tentative decisions, are a part of the record and shall include a statement of—

(A) findings and conclusions, and the reasons or basis therefor, on all the material issues of fact, law, or discretion presented on the record; and

(B) the appropriate rule, order, sanction, relief, or denial thereof.

Accordingly, the Commission and its administrative law judges are mandated by the Act to state findings of fact, conclusions of law, and the reasons or basis therefor in all decisions and reports.

Judge Worcester’s report clearly does not comply with the requirements set out above. It does not state the reasons or basis for his conclusions to vacate the citations. Accordingly, we find that his report is not in accordance with section 557(c), and remand it for a decision that comports with the section.

We do not decide any other issue raised by the Secretary’s petition. The remainder of the petition is predicated on the Secretary’s assumption as to the reasons the judge might have assigned for his disposition. Since the judge did not state his reasons we are unwilling to assume what they might be. However, we do note that the questions presented concern whether the joint venture should be added as a party and there is case law on the subject. Bloomfield Mechanical Contracting, Inc. v. OSAHRC, 519 F.2d 1257 (3d Cir. 1975); Vincent Rizzo Construction Co., OSHRC Docket No. 4224, BNA 3 OSHC 1841, CCH OSHD para. 20,236 (1975).

Accordingly, this matter is remanded for further proceedings consistent with this opinion. So ORDERED.

FOR THE COMMISSION:

WILLIAM S. McLAUGHLIN

Executive Secretary

DATE: MAY 21, 1976

MORAN, Commissioner, Concurring in Part, Dissenting in Part:

On February 6, 1976, the same two members who make up the majority for the decision in this case issued a decision in Secretary v. Francisco Tower Service, Inc., OSAHRC Docket No. 4845. That decision contained no findings of fact or conclusions of law. I dissented from that opinion and—no less than five times—I pointed out that the decision was wrong because it contained no findings of fact or conclusions of law. For example, the dissent states at one point that

Messrs. Barnako and Cleary have here declined to make any findings with respect to questions of fact—nor have they adopted the findings with respect to questions of fact which were made by the Judge below.

Not only did they issue that decision but they followed it up with no less than forty subsequent decisions which cite it as authority for disposing of a case without making any findings of fact or conclusions of law. In none of those cases was there any reference to the point made in the dissent which accompanied each of them, regarding the absence of any finding of fact or conclusion of law. See, for example, Secretary v. Mohawk Excavating, Incorporated,[2]OSAHRC Docket No. 8845, February 17, 1976; Secretary v. Desarrollos Metropolitanos, Inc.,[3] OSAHRC Docket No. 11884, February 17, 1976; and Secretary v. Texaco, Incorporated,[4] OSAHRC Docket No. 11903, February 17, 1976.

Now, however, the same two members who, through some 40 decisions earlier this year steadfastly ignored the requirement that decisions include findings of fact and conclusions of law, tell us that the law is as follows:

‘. . . the Commission and its administrative law judges are mandated by the Act to state findings of fact, conclusions of law, and the reasons or basis therefor in all decisions and reports.’ (Emphasis added.)

It is not surprising to me that they do not acknowledge that they have failed to observe this mandate even though it has been called to their attention in 40 dissenting opinions issued earlier this year. It is also not surprising that Messrs. Barnako and Cleary let those decisions stand without reversing a single one of them—even though their decision in this case states exactly the opposite of what they did in the above-mentioned cases. Diametrically opposite ‘rules’ applied—or not applied—depending on the result produced thereby, has become pretty standard in this Commission during the past nine months.

In the case presently before us, I concur in the disposition ordering the case remanded. This will afford the complainant the opportunity to proceed against either or both respondents individually if he considers such action appropriate. If complainant elects to proceed against respondent Shea, it will be necessary for him to establish proper service of the citations and notice of proposed penalty on that respondent in accordance with 29 U.S.C. § 659(a).[5] Furthermore, in any further proceeding, I would require complainant to establish that the more than two month delay in issuing the citations was due to exceptional circumstances.

In Bloomfield Mechanical Contracting, Inc., v. OSAHRC, 519 F.2d 1257 (3d Cir. 1975), cited by the majority, the Secretary of Labor attempted to add a joint venture as a party by way of the complaint in a manner similar to the attempted amendment in the instant case. Noting that the Secretary had ‘failed to amend the citation at any time,’ the court also stated that ‘[i]t is the citation which serves as the statutory vehicle for notice of the violation, 29 U.S.C. § 658(a).’ 519 F.2d at 2162 (emphasis added). Clearly then, the attempted amendment in that case, regardless of the statute of limitations problem involved,[6] was inadequate to amend the citation to name a new party. An amended citation must be issued. This is particularly apparent since the court noted that the complaint procedure is only a ‘creature of administrative regulation’ which is not mentioned in the Act at all. 519 F.2d at 1262. Because notice by way of a citation and notice of proposed penalty is a particular statutory requirement, amendment under Rule 15 of the Federal Rules of Civil Procedure by way of a complaint cannot be allowed.[7] An amendment which adds a new party creates a new cause of action which must be commenced by the issuance and proper service of a citation and notice of proposed penalty upon the named party.

Furthermore the record in this case tends to indicate that respondent Shea, was never served with the original citation. Although the citation named ‘P & Z Co., Inc. and J. F. Shea Co., Inc.,’ it was only served on P & Z. The two named respondents are separate corporate entities with different mailing addresses. As indicated in the Bloom-field decision, service on one member of a joint venture may be adequate service on the joint venture itself if the joint venture is named in the citation. 519 F.2d at 1261. It was not in the instant case. It matters not whether Shea did or did not have actual notice if proper service rules were not followed. Secretary v. Donald K. Nelson Construction, Inc., OSAHRC Docket No. 4309, January 13, 1976. Accordingly, Shea may never have been a party respondent in this case. If so, allowing an amendment under Rule 15 to add the joint venture as a party respondent would not merely change the status of parties already before us, but would add a new party.

If Shea was never properly served, the only possible legitimate respondent remaining is P & Z. This Commission, however, has never determined whether an individual participant in a joint venture is an employer for purposes of liability under 29 U.S.C. § 654(a)(2) for alleged safety violations committed by the joint venture. We have never decided this question because in prior cases where a joint venture was involved the Secretary has cited both the joint venture and its members[8]8 or the joint venture alone.[9]9 Furthermore, the court in Bloomfield Mechanical Contracting, Inc. v. OSAHRC, supra, specifically declined to answer the question. 519 F.2d at 1261 n.1.

The National Labor Relations Board (NLRB) has considered the above question in administering the National Labor Relations Act (NLRA) and has determined that individual participants in a venture are not employers and any violations of the NLRA are attributable solely to the joint venture, Grove Shepherd Wilson & Kruge, Inc., 109 NLRB No. 21, 34 LRRM 1338 (1954), Willamette National Lumber Co., 107 NLRB No. 237, 33 LRRM 1328 (1954). Similarly, in Wilcox Construction Co., Inc., 87 NLRB No. 56, 25 LRRM 1110 (1949), a company participating in a joint venture was found not to be the employer of guards at the project since the joint venture exercised control of hiring and firing of personnel and established their working hours. Unfortunately, the record before us does not contain sufficient evidence to permit a determination such as those made by the NLRB.

The inspection of the worksite in the instant case took place between May 30, 1975 and June 6, 1975, but the citations were not issued until August 7, 1975. Since the delay between the inspection and the issuance of the citation far exceeded the 72 hours allowed by Congress under normal operating conditions, the citation must be vacated for failure to comply with the reasonable promptness requirements of 29 U.S.C. § 658(a) unless complainant establishes that the delay was justified by exceptional circumstances. Secretary v. Concrete Construction Corporation, OSAHRC Docket No. 2490, April 8, 1976 (dissenting opinion).

UNITED STATES OF AMERICA

OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION

SECRETARY OF LABOR,
Complainant,
v.	OSHRC DOCKET NO. 14822
P & Z CO., INC. and J. F. SHEA CO., INC,
Respondent.

December 12, 1975

ORDER

The motion of the respondent to dismiss the complaint without leave to amend is granted. It is therefore hereby ordered that the citation and proposed penalty be vacated.

BEN D. WORCESTER

Judge, OSAHRC

Dated: December 12, 1975

Hyattsville, MD

[2] Presently on appeal in the U.S. Court of Appeals for the 2d Circuit (No. 76–4068, filed March 3, 1976).

[3] Presently on appeal in the U.S. Court of Appeals for the 1st Circuit (No. 76–1084, filed April 12, 1976).

[4] Presently on appeal in the U.S. Court of Appeals for the 10th Circuit (No. 76–1318, filed April 19, 1976).

[5] This section requires that a cited employer be notified by certified mail of the penalty, if any, proposed by the Secretary to be assessed against the employer for alleged violations.

[6] A citation may not be issued after the expiration of six months following the occurrence of any violation. 29 U.S.C. § 658(c).

[7] I have discussed the reasons why the amendment rules in Rule 15, Federal Rules of Civil Procedure, do not apply to citations in greater detail in Secretary v. Warnel Corporation, OSAHRC Docket No. 4587, March 31, 1976.

[8] See e.g., Secretary v. Underhill Construction Corp., Individually and Dic Concrete Corp., Individually and trading as Dic-Underhill, a Joint Venture, 20 OSAHRC 534 (1975).

[9] Secretary v. Straight Creek Constructors, 7 OSAHRC 1158, 1166 (1974).