Q. A. 56 Agric. Dec. 1045 [BY MR. PARLETTE] Where do you market your fruit now? [BY MR. LYONS] We market our fruit through Holman's, H&H Orchards, and they -- they do the sales aspect of it and the handling of them, and then the inspectors check. The federal inspectors come in there at the plant and does [sic] the inspecting. Q. A. Q. Committee? [BY MS. DESKINS] Do you pay assessments on Rainier cherries? [BY MR. LYONS] Oh, yeah. You can't get them inspected unless you do. Do you pay the assessments to the Washington Cherry A. We pay them -- H&H Orchards does the assessing -- not the assessing, but collects the money, and I end up paying it, yeah. A. Right. They do the marketing for my Rainier cherries. That's right. Tr. 176, 181, 194-95. Likewise, Mr. Gutzwiler (Tr. 9[3]-116) and Mr. Parlette testified as to Mr. Parlette's operations [Hoverhawk, Inc.] relative to Rainier cherries. Mr. Parlette's testimony contained the following description of his activities: [BY MR. PARLETTE] I market my fruit through the co-op known as Skookum or now Bluebird. My field man is Norm Gutzwiler, who has testified here today, and the gentleman who operated my orchard in 1995-94-93, Shad Snyder, previously testified. Previous to that time, I operated the orchard substantially by myself and contracted out the pruning. Q. [BY MS. DESKINS] Okay. Have you ever handled cherries? And I mean handle as defined in the marketing order. [BY MR. PARLETTE] A. Q. CFR. What I have field packed cherries, just as Mr. Lyons has done. - Okay. What I mean by handle is -- let me refer you to the in the interest of time, let me just show you what the definition is. It's 923.13, and just tell me that's what I mean by handle. Q. A. Okay. Do you handle cherries as defined in that regulation? To the extent that my field pack cherries are marketed through Skookum, I am a handler of cherries. Tr. 229, 250-51 (emphasis added [by the ALJ]). Moreover, a review of the record... reveals how Hoverhawk, Inc., and Lyons 56 Agric. Dec. 1045 & Son, Inc., believed they were paying the assessments. [Respondent did not challenge Hoverhawk, Inc.'s and Lyons & Son, Inc.'s] status as handlers... until a few minutes before the hearing closed [(Tr. 389-94)]. Included among the allegations of the Petition were those that: Petitioner Auvil Fruit Company is a handler of Rainier cherries. Petitioner Hoverhawk, Inc., is a sole proprietorship and acts as a handler of Rainier cherries when field packing and selling fruit directly to purchasers. Petitioner Lyons & Son[], Inc., is a handler of Rainier cherries. [Petition at 2.] The Answer ... contained the following: 1. The allegations of page[s] 1 and 2 contain descriptions of the [P]etitioners['] operating structure and the sections of the Cherry Marketing Order that the [P]etitioners seek to have reconsidered to which no response is required. However, to the extent that a response is required the [R]espondent is without sufficient knowledge to respond. [Answer at 1.] In [Respondent's] Response [to Order for Additional Briefing at 4, 5 n.5, 6 n.7,] Respondent notes that were Petitioners Hoverhawk, Inc., and Lyons & Son, Inc., to be regarded as handlers, they would have been required to file reports, in addition to paying assessments. Respondent does not set forth the [type] or number of reports which would have been filed.' However, [the failure to pay assessments or file reports required of handlers] cannot be regarded as determinative by itself inasmuch as the failure to file a report [or pay an assessment] does not necessarily mean that someone is not a handler. .. Respondent, in [Respondent's Response to Order for Additional Briefing,] recognizes the need to examine the full spectrum of activities in determining handler status: ..[T]he Order does not define a handler on the basis of who pays the 'The record evidence does not reveal whether Petitioners [Hoverhawk, Inc., and Lyons & Son, Inc.,] filed reports or not, although inference to the contrary can be [deduced] from the testimony of the [Washington Cherry Marketing] Committee's manager[, Lucille McFarland (Tr. 388-98)]. Section 923.60 [of the Cherry Order], 7 C.F.R. § 923.60,... requires the filing of reports. Petitioners, for violations thereof, would be subject to an enforcement action pursuant to 7 U.S.C. § 608c(14)(B). assessments. A person does not become a handler under the Order by paying assessments. The payment of an assessments [sic] and the filing [of] reports are relevant to the extent that these activities are required of handlers and are often indicative of who is the handler." Thus, the claims that certain costs are passed down by a handler to a grower does not make the grower a handler and is irrelevant to determine who is a handler. [Footnote omitted.] ' Under the terms of the Order a handler is still a handler even when a handler does not pay an assessment or file reports. In situations where a handler does not pay assessments or file reports, the handler is subject to enforcement actions pursuant to 7 U.S.C. § 608(c)(14)(A) and (B). The converse of this is not true. In other words, if a person pays an assessments [sic] and files reports this action does not make that person a handler unless the person also conforms with the statutory definition of handler. [Respondent's Response to Order for Additional Briefing at 6.] However, because the Department has determined that growers such as Hoverhawk, Inc., and Lyons & Son, Inc., who field pack, and then have another entity palletize the boxes and achieve inspection (but which charges the growers for the assessments) are not handlers, the... Petition as to Hoverhawk, Inc., and Lyons & Son, Inc.[, is dismissed]. The Judicial Officer gives [controlling] weight to an agency's own interpretation of its own regulations and, accordingly, his views are followed [in this Decision and Order]. ... [For instance, in Mil-Key Farm: At the outset, it is important to note that this case involves the interpretation of Milk Marketing Order No. 124 by the agency which promulgated and administers that Order. "[P]rovided an agency's interpretation of its own regulations does not violate the Constitution or a federal statute, it must be given `controlling weight unless it is plainly erroneous or inconsistent with the regulation."" Stinson v. United States, 113 S.Ct. 1913, 1919 (1993) (citations omitted). In re Mil-Key Farm, Inc., 54 Agric. Dec. 26, 52-53 (1995).] Such views are in accord with Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984): When a court reviews an agency's construction of the statute which it 56 Agric. Dec. 1045 administers, it is confronted with two questions. First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress. If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute, as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute. "The power of an administrative agency to administer a congressionally created... program necessarily requires the formulation of policy and the making of rules to fill any gap left, implicitly or explicitly, by Congress." Morton v. Ruiz, 415 U.S. 199, 231 (1974). If Congress has explicitly left a gap for the agency to fill, there is an express delegation of authority to the agency to elucidate a specific provision of the statute by regulation. Such legislative regulations are given controlling weight unless they are arbitrary, capricious, or manifestly contrary to the statute. Sometimes the legislative delegation to an agency on a particular question is implicit rather than explicit. In such a case, a court may not substitute its own construction of a statutory provision for a reasonable interpretation made by the administrator of an agency. [Chevron, supra, 467 U.S. at 842-44 (footnotes omitted)]. Chevron's instruction to a court conducting a judicial review of an agency's construction of a statute, which it administers, has logical application to an administrative review by an administrative law judge whose neutrality requires distancing from those who are involved with the program's day-to-day operations. It is the experience and the sense of the legislative purpose those agency administrators possess, that the Chevron court singled out for judicial deference; deference that should be given by an administrative law judge when a pertinent interpretation of this kind has been made prior to a petition for administrative review. Hereinafter the term "Petitioner Auvil" shall refer to Auvil Fruit Company, unless otherwise indicated. |