Summary of a Recent
Judicial Development in
Environmental Law

Missouri Administrative Procedure Act Does Not Authorize State Courts
to Entertain Declaratory Judgment Actions Regarding Potential Rules

Eric H. Foy
National AgLaw Center Research Associate

Summary of Decision

In Missouri Soybean Association v. Missouri Clean Water Commission, 102 S.W.3d 10 (Mo. 2003), the Supreme Court of Missouri affirmed the modified decision of the circuit court, which had dismissed the declaratory judgment petition of several trade and business associations with prejudice. The associations challenged the decision of the Missouri Clean Water Commission to include the Missouri and Mississippi rivers on the Environmental Protection Agency's (EPA) impaired waters list. The instant court held that state courts lacked subject matter jurisdiction over declaratory judgment action challenging the Commission's decision, and that the controversy was not ripe for review. The petition was dismissed but without prejudice.

Background

Section 303(d) of the Clean Water Act (CWA) required the Commission to submit a list of impaired waters to the EPA for approval. Id. at 20. The Commission "divided the waters into three categories: (1) those waters proposed for full [Total Maximum Daily Load (TMDL)] development; (2) those waters reported as impaired, but for which documentation was outdated or inadequate--requiring further environmental monitoring prior to TMDL development," and "(3) those waters, recognized as impaired, but for which there was no practical remedy." Id. After reviewing the Commission's list, the EPA partially approved and partially disapproved the Commission's characterizations. Id. The EPA disapproved the Commission's list "for failure to include five waters that did not meet Missouri's water quality standards and for failure to retain ten waters from the State's 1996 list." Id. After the EPA added an additional six water bodies, the finalized list for 1998 contained a combination of 165 lakes, rivers, and streams. Id. Additionally, the EPA "stated that even though Missouri chose to categorize its list, the EPA's position remained that TMDLs were to be established for all waterbodies on Missouri's 1998 list." Id.

Challenging the EPA's approval of the finalized list for 1998, several trade and business associations unsuccessfully brought suit in federal court. Id. The associations appealed to the circuit court, which dismissed their action with prejudice because the court lacked subject matter jurisdiction. Id. at 21. It held that:

neither the Commission nor [the Minnesota Department of Natural Resources] had rendered a final decision subject to judicial review. Rather . . . the EPA was the final arbiter of whether a particular waterbody [was] impaired, and [] while the EPA may have rendered a final decision with respect to the 1998 list of impaired waters, that agency's actions were beyond the purview of the court.
Id.

The associations then appealed to the instant court.

Arguments

The associations argued that the 1998 § 303(d) list was a rule, and that the Commission had "engaged in rulemaking." Id. at 24. For this reason, the associations claimed the instant court could exercise subject matter jurisdiction necessary to issue a declaratory judgment pursuant to Missouri Administrative Procedure Act (MAPA) § 536.050.1. Id.

Analysis and Holdings

In order for a court to hear a case or controversy, it must have subject matter jurisdiction-authority over the subject matter at issue. Id. In the instant action, the associations sought a declaratory judgment pursuant to MAPA § 536.050.1. Id. at 22. When a party seeks a declaratory judgment pursuant to MAPA § 536.050.1, the court's subject matter jurisdiction stretches no further than the section's limits. Id. MAPA § 536.050.1 "authorizes [Missouri state courts] to render declaratory judgments as to the validity of a rule or the threatened application of such a rule." Id. Therefore, declaratory judgments under the MAPA are not available unless the administrative action in question constitutes a rule. Id.

The associations argued the 1998 § 303(d) list was a rule, and that the Commission had "engaged in rulemaking." Id. at 24. Under Baugus v. Director of Revenue, 878 S.W.2d 39, 42 (Mo. 1994), the instant court held that "an agency declaration cannot constitute a rule unless it has a potential impact on the rights of some member of the public." Id. In the instant case, the associations pointed to the potential impact of a potential rule rather than the potential impact of a rule. Id. Further regulations were needed to convert the 1998 § 303(d) list from a potential rule into a rule. Id. Ultimately, the court held, "Because Missouri's 303(d) list for 1998 [was] not a rule, the circuit court lacked subject-matter jurisdiction pursuant to section 536.050.1 to render the sought-after declaratory judgment." Id. at 25.

Additionally, the court stated the instant action was not ripe for adjudication. Id. at 27. The court asked the following two questions to aid in its ripeness analysis: (1) were the issues tendered appropriate for judicial resolution, and (2) what degree of hardship would the associations face if judicial relief were denied. Id. The court held that the list did not require the associations to change their conduct in any way; therefore, the potential hardships to the associations were too speculative. Id. Also, the controversy was not appropriate for judicial review because it could not be resolved by declaratory judgment. Id. Therefore, the court held the case was not ripe for review. Id. at 29. The case was dismissed without prejudice because the case was not ripe and the court lacked subject matter jurisdiction.

The case was decided on April 22, 2003.