In 2015, the Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers (the Corps) finalized a rule that either “clarified” the scope of Clean Water Act that regulates “the discharge of any pollutant” into “the waters of the United States” or greatly expanded their regulatory authority to puddles, ponds, ditches, and occasional wet spots all across America. The matter is, of course, under litigation. 

In the meantime, land owners and developers have to cope with the existing difficult and cumbersome regulations that have been nearly impossible to challenge without risking prosecution or incurring long delays and big costs. That just changed in a dramatic way thanks to the U.S. Supreme Court. 

Now some of those battles can be fought by lawyers up front instead of in defense of a prosecution. Thanks to the Court’s recent decision in United States Army Corps of Engineers v. Hawkes Co., property owners and developers can have their day in court sooner rather than later.

It is often difficult to determine whether a particular piece of property contains waters of the United States covered by the Clean Water Act, but there are important consequences if it does. The Clean Water Act imposes substantial criminal and civil penalties for discharging any pollutant into waters covered by the Act without a permit from the Corps. Getting a permit can take years if the Corps has jurisdiction over the property. 

Why not settle the jurisdictional questions in the beginning? The Corps can issue a jurisdictional determination before issuing or denying a permit under the Clean Water Act , but the Corps did not consider a jurisdictional decision to be final and subject to challenge. 

The Corps contended that the respondents had only two alternative courses of action if they wanted to challenge the Corps’ assertion of jurisdiction. They could either act without a permit, risking an EPA enforcement action during which they could argue that no permit was required, or they could apply for a permit and seek judicial re¬view if they were dissatisfied with the results.

The Supreme Court found that neither alternative was adequate and ruled that a jurisdictional determination is a final agency action judicially reviewable under the Administrative Procedures Act without waiting for the Corps to finish the permitting process. The Court noted:
 

“. . . parties need not await enforcement proceedings before challenging final agency action where such proceedings carry the risk of “serious criminal and civil penalties. If respondents discharged fill material without a permit, in the mistaken belief that their property did not contain jurisdictional waters, they would expose themselves to civil penalties of up to $37,500 for each day they violated the Act, to say nothing of potential criminal liability. 

Respondents need not assume such risks while waiting for EPA to “drop the hammer” in order to have their day in court. 

Nor is it an adequate alternative for a landowner to apply for a permit and then seek judicial review in the event of an unfavorable decision. As Corps officials indicated in their discussions with respondents, the permitting process can be arduous, expensive, and long.”

This decision will come as welcome relief to property owners. Not that litigation with the federal government is easy or inexpensive, but litigating an issue before you are dragged through a knot hole is usually a lot better than doing it afterwards.