                                                                                                                           Opinions of the United
2004 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


6-9-2004

Avon Contractors Inc v. Secretary Labor
Precedential or Non-Precedential: Precedential

Docket No. 03-1615




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Recommended Citation
"Avon Contractors Inc v. Secretary Labor" (2004). 2004 Decisions. Paper 563.
http://digitalcommons.law.villanova.edu/thirdcircuit_2004/563


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                       PRECEDENTIAL       Ronald J. Gottlieb, Esquire (Argued)
                                          United States Department of Labor
        UNITED STATES                     Office of the Solicitor
       COURT OF APPEALS                   Suite S-4004
     FOR THE THIRD CIRCUIT                200 Constitution Avenue, N.W.
                                          Washington, D.C. 20210
                                                 Attorney for Respondent,
             No. 03-1615                         Secretary of Labor


    AVON CONTRACTORS, INC.,                       OPINION OF THE COURT
                   Petitioner

                  v.                      SCIRICA, Chief Judge.
                                                  At issue is whether Petitioner Avon
    SECRETARY OF LABOR;
                                          Contractors, Inc. is entitled to relief under
  OCCUPATIONAL SAFETY AND
                                          the excusable neglect standard of Fed. R.
 HEALTH REVIEW COMMISSION,
                                          Civ. P. 60(b)(1), after it failed to timely
                   Respondents
                                          file a notice of contest to Occupational
                                          Safety and Health Administration Citations
                                          and a Notice of Penalty delivered by
On Petition for Review of a Final Order
                                          certified mail. We addressed similar
of the Occupational Safety and Health
                                          issues in George Harms Construction Co.
         Review Commission
                                          v. Chao, No. 03-2215 (3d Cir. June 9,
        (OSHRC No. 02-0772)
                                          2004), in which we heard oral argument on
                                          the same day as this matter.

       Argued February 12, 2004                   We will vacate the Occupational
                                          Safety and Health Review Commission’s
   Before: SCIRICA, Chief Judge,          final order and remand for a hearing on the
  ROTH and McKEE, Circuit Judges          merits of the OSHA citations.
                                                               I.
         (Filed: June 9, 2004)
                                                 OSHA conducted an inspection of
Donald A. Kessler, Esquire (Argued)       Avon’s work site at Northvale, New Jersey
Schwartz, Simon, Edelstein,               from January 8 through January 10, 2002.1
 Celso & Kessler
10 James Street
                                              1
Florham Park, New Jersey 07932                 Congress enacted the Occupational
      Attorney for Petitioner             Safety and Health Act to “assure so far as
                                          possible” safe working conditions for
                                          “every working man and woman in the
                                                     OSHA found two infractions.2 After the
                                                     inspection, Charles Tristitti of OSHA’s
                                                     Hasbrouck Heights Area Office contacted
Nation.” 29 U.S.C. § 651(b). The
                                                     Avon’s Office Manager Lori Muranelli by
Secretary of Labor is charged with
                                                     telephone and advised her of two
enforcement of the Act. But the Secretary
                                                     forthcoming citations. OSHA sent the
has delegated her enforcement duties to
                                                     citations by certified mail to Avon on
the Assistant Secretary for Occupational
                                                     February 22, 2002. Avon’s receptionist,
Safety and Health, who heads OSHA.
                                                     Tonya Grant, signed for the citations on
Secretary’s Order 5-2002, 67 Fed. Reg.
                                                     February 26, 2002.        Muranelli, the
65008 (Oct. 22, 2002). OSHA inspects
                                                     employee at Avon responsible for OSHA-
workplaces for violations. It may issue a
                                                     related matters, never received the
citation for a violation, establish a date for
                                                     citations.
abatement, and propose a civil penalty.
29 U.S.C. §§ 658, 659. An employer can                      In or around March 2002, Avon
contest the citation and the proposed                discovered it was missing mail and
penalty before the Occupational Safety and           suspected its receptionist, Tonya Grant,
Health Review Commission. 29 U.S.C. §                was responsible. According to M uranelli,
661. Under section 10(a) of the Act, an              “around” the time of March, 2002,
employer must file a notice of contest               managers started complaining about
within 15 working days of receipt of the             missing mail. “Between February and
citation or the “the citation and the                March, right before [the receptionist] left
assessment, as proposed, shall be deemed             the Company,” Muranelli told the
a final order of the Commission and not              receptionist that some mail items were
subject to review by any court or agency.”           missing. Muranelli warned her to ensure
29 U.S.C. § 659(a).                                  that the proper recipients got their mail.
        The Commission, an independent               Muranelli also told the receptionist that
adjudicatory body separate from the                  she was not to sign for any certified mail
Department of Labor, acts as a neutral
arbiter in proceedings contesting OSHA
citations. Cuyahoga Valley Ry. Co. v.                decision. Id. Judicial review may then be
United Transp. Union, 474 U.S. 3, 7                  sought. 29 U.S.C. § 660.
(1995) (per curiam ).             Ass um ing
                                                        2
jurisdiction, an Administrative Law Judge                In the citations, OSHA alleges Avon
of the Commission conducts a hearing and             violated 29 C.F.R. § 1926.300(b)(1), by
issues a report with his determination of            operating power tools without a required
the proceeding. 29 U.S.C. § 661(j).                  guard. It also alleges Avon violated 29
Within thirty days, the Commission may               C.F.R. § 1926.501(b)(1), by not providing
opt to review the ALJ’s report. Id. If no            a guardrail system, safety net system, or
Commissioner directs review, the ALJ’s               personal fall arrest system for employees
report becomes the Commission’s final                working on a roof.

                                                 2
because it was Muranelli’s responsibility                   On January 21, 2003, an ALJ filed
as office manager to do so. “In the middle          his decision and order granting the
towards the end of March,” the                      Secretary’s dismissal motion. See Avon
receptionist resigned. Muranelli testified          Contractors, Inc., No. 02-0772, 2003
that the receptionist was “disgruntled” and         OSAHRC LEXIS 47 (OSAHRC Jan. 21,
quit because she had heard she would be             2003). Though finding that Avon made a
terminated for losing or destroying mail.           “compelling” argument, the ALJ held
In April 2002, Avon discovered that some            against Avon on its excusable neglect
of its certified mail was missing. Avon             claim because Avon had not shown
claims it was not aware that its receptionist       “whether the failure [to receive notice of
was destroying or losing mail at the time           the violation] was within the control of the
the OSHA citations were mailed and                  employer.” Id. at *4-5. Particularly, the
received.                                           ALJ found, the record did “not show how
                                                    long the receptionist had been destroying
        On April 26, 2002, Muranelli
                                                    or misplacing mail or when the company
contacted OSHA to inquire about the
                                                    first became aware of the problem.” Id. at
status of the citations. On April 29, 2002,
                                                    *4. Accordingly, the ALJ could not tell
Avon received a demand letter from
                                                    whether the de structi on was an
OSHA and a copy of the citations and
                                                    “unprecedented and unexpected act, or
notice of penalty. On May 15, 2002, Avon
                                                    whether this type of activity was an
submitted a late notice of contest.
                                                    ongoing problem which should have been
        The matter was docketed before the          corrected.” Id. at *5. The ALJ noted “the
Commission. Avon claimed it was entitled            only apparent effort Avon undertook to
to relief under the “excusable neglect”             rectify the problem was to tell the
standard of Fed. R. Civ. P. 60(b)(1).               receptionist not to accept certified mail,
Section 12(g) of the Act provides that the          and . . . this occurred ‘right before’ the
“Commission is authorized to make such              receptionist left the company.” Id. The
rules as are necessary for the orderly              ALJ denied relief under Fed. R. Civ. P.
transaction of its proceedings. Unless the          60(b) because he was unable to “find that
Commission has adopted a different rule,            it was not within Avon’s reasonable
its proceedings shall be in accordance with         control to prevent the series of events
the Federal Rules of Civil Procedure.” 29           which led up to its failure to timely file the
U.S.C. § 661(g). Fed. R. Civ. P. 60(b)(1)           NOC.” Id. The ALJ also rejected the
provides that “[o]n motion and upon such            Secretary’s conte ntion th at the
terms as are just, the court may relieve a          Commission did not have authority to
party or a party’s legal representative from        accept a late-filed notice of contest. The
a final judgment, order, or proceeding for          ALJ noted:
the following reasons: (1) mistake,
                                                           Relying on Le Frois Builder
inadvertence, surprise, or excusable
                                                           Inc., 291 F.3d 219 (2d Cir.
neglect . . . .” Id.

                                                3
             2002), the Secretary’s                                    II.
             motion asserts that the
                                                         In George Harms Construction Co.
             Commission does not have
                                                  v. Chao, No. 03-2215 (3d Cir. June 9,
             authority to accept a late-
                                                  2004), we rejected the Secretary’s
             filed NOC. The Secretary’s
                                                  contention that J.I. Hass Co. v. OSHRC,
             reliance on Le Frois,
                                                  648 F.2d 190 (3d Cir. 1981), had been
             however, is misplaced, as
                                                  undermined by subsequent precedent.
             this case arises in the Third
                                                  Harms, No. 03-2215, op. at 4-8. We held
             Circuit, not the Second.
                                                  that under Hass, section 10(a) is not a bar
             Accordingly, J. I. Hass Co.,
                                                  to Commission review, and the
             Inc., 648 F.2d 191 (3d Cir.
                                                  Commission has jurisdiction to entertain a
             1981) and Branciforte
                                                  late notice of contest under the excusable
             Builders, Inc., 9 BNA
                                                  neglect standard of Fed. R. Civ. P.
             OSHC 2113 (No. 80-1920,
                                                  60(b)(1). See Harms, No. 03-2215, op. at
             1981), not Le Frois, are
                                                  8.
             controlling.
                                                          Moreover, in Harms, we held the
Id. at *3 n.2.
                                                  Supreme Court’s holding in Pioneer
       Avon appeals to vacate the                 Investment Services v. Brunswisk Assoc.,
Commission’s order and remand for a               507 U.S. 380 (1993), applies to
hearing on the underlying citation.3 It           Commission proceedings where the
argues that it is entitled to the relief of       excusable neglect standard is implicated.
“excusable neglect” under Fed. R. Civ. P.         See Harms, No. 03-2215, op. at 8. We
60(b)(1). Not only does the Secretary             noted that in Pioneer “the Supreme Court
dispute those claims, she also contends           identified, without limitation, these factors
that section 10(a) of the Act, 29 U.S.C. §        to consider: ‘the danger of prejudice . . . ,
659(a), precludes the Commission from             the length of the delay and its potential
considering the Fed. R. Civ. P. 60(b)(1)          impact on judicial proceedings, the reason
“excusable neglect” standard when a               for the delay, including whether it was
notice of contest is untimely filed.4             within the reasonable control of the
                                                  movant, and whether the movant acted in
         3
                                                  good faith.’” Id. (quoting Pioneer, 507
       The Commission had jurisdiction            U.S. at 395). We held the “control” factor
under 29 U.S.C. § 659. We have appellate          does not necessarily trump all the other
jurisdiction under 29 U.S.C. § 660.
     4
     The Commission’s factual findings
must be affirmed if supported by                  are to be affirmed unless they are arbitrary,
substantial evidence on the record as a           capricious, an abuse of discretion, or
whole. Reich v. D.M. Sabia Co., 90 F.3d           contrary to law. Id. (citing 5 U.S.C. §
854, 856 (3d Cir. 1996). Its adjudications        706(2)(A)).

                                              4
relevant factors. Id. at 9. Furthermore, an        controlling on whether the loss of the
arbiter must take into account all relevant        citations was within Avon’s reasonable
circumstances surrounding a party’s failure        control. It would be difficult to show
to file a timely notice of contest. Id. We         precisely how long the deliberate acts had
faulted the ALJ for weighing too heavily           been ongoing in part because employees
the “control” aspect of the case at the            who commit destructive or negligent acts
expense of other relevant Pioneer factors.         generally do not broadcast their conduct.
See id. at 8-9.                                    Until Avon discovered the missing mail
                                                   and the receptionist’s allegedly deliberate
        Here, the ALJ made similar errors
                                                   acts of destruction, there was little beyond
in its “excusable neglect” calculus.
                                                   the established mailing procedures in place
Several of the factors weighed in favor of
                                                   that could be done to prevent mishandled
a finding for Avon. The Secretary did not
                                                   mail. Nor is there any reason to assume
apparently suffer prejudice; the delay did
                                                   that a company would know that its mail
not negatively impact the proceeding; and
                                                   was being destroyed or misplaced but
as the ALJ noted, “Avon’s argument is
                                                   would act against its own self-interest in
compelling, particularly as Avon initiated
                                                   choosing to ignore it. Moreover, though
contact with OSHA with respect to the
                                                   the precise date on which Avon discovered
whereabouts of the citation.” Avon, 2003
                                                   it was missing mail is unclear, the record
OSAHRC LEXIS 47, at *4. But the ALJ
                                                   demonstrates that Avon discovered that it
explained that “a key factor in determining
                                                   was missing mail just prior to the
this issue is whether the failure was within
                                                   receptionist’s departure in February or
the control of the employer” and found
                                                   March. The record shows that Avon did
against Avon because the evidence it
                                                   not discover that certified items were
presented was insufficient for showing the
                                                   destroyed or misplaced until sometime in
loss “was not within Avon’s reasonable
                                                   April. When OSHA sent the certified mail
control.” Id. at *4-5. In doing so, the ALJ
                                                   containing the citations to Avon in
did not properly weigh all the relevant
                                                   February, there is no evidence that it was
Pioneer factors.
                                                   within Avon’s control to prevent the
        Moreover, we disagree that Avon            unforeseeable acts of destruction by its
failed to prove that the loss was not within       employee. Because the Pioneer factors of
its reasonable control. The ALJ found              good faith, prejudice, efficient judicial
fatal to Avon’s petition the fact that the         administration, and control all weigh in
record does not show “how long the                 favor of Avon, it has sufficiently shown
receptionist had been destroying or                “excusable neglect” and is entitled to relief
misplacing the mail or when the company            under Fed. R. Civ. P. 60(b)(1).
first became aware of the problem.” Id. at
                                                                       III.
*4. But the failure to show how long the
receptionist had been destroying or                       For the foregoing reasons, we will
misplacing mail is not necessarily                 vacate the Commission’s final order and

                                               5
remand for a hearing on the merits of the
subject OSHA citations.




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