The only viable method of determining whether flow
augmentation (dilution) is being used is to set mass
limitations. Therefore, the metal finishing standards
do require mass limitations and do not provide an
exception to 40 CFR § 122.45 which requires permit
limits to be expressed in terms of mass.

However, the Region has failed to mention the exception contained in 40 CFR § 122.45(f)(1)(ii), which provides:

"A manual prepared in April 1985 for permit writers contains the following statement regarding mass v. concentration limits:

Mass vs Concentration Limits

Most of the effluent limitations for industrial facilities are ex-
pressed in terms of allowable mass (in units of pounds or kilo-
grams of pollutant per day. The permit writer should also con-
sider the use of concentration limits The rationale for including
concentration limits is to encourage the proper operation of the
treatment facility at all times. In the absence of concentration
limits, a permittee could theoretically reduce treatment efficiency
during low flow periods and still meet the facility's mass-based
effluent limits. For example, Company A could have an average
daily wastewater flow of 0.9 MGD. On a given day, the wastewater
flow might drop to 0.6 MGD. In this example, pollutant "X" could
be 150% of the 'normal' average. However, the company would
still be in compliance with its permit, unless concentration limits
were also included. (Emphasis added).

In certain instances, the use of concentration limits may be
counter-productive since they may discourage the use of innovative
techniques such as water conservation. As an example, if a facility
had a history of providing efficient treatment of its wastewater
and also wished to practice water conservation, inclusion of con-
centration limits would probably not be appropriate. To summa-
rize, the applicability of concentration limits should be a case-
by-case determination based upon the professional judgment of
the permit writer.

As a general matter, then, according to the permit writer's manual, if concentration limits are imposed at all, they are imposed as a supplement to rather than as a substitute for mass limits (See § 122.45(f)(2)).

It should be noted, however, that the manual's cover page contains the following disclaimer:

The material in this manual [prepared by the Agency's Office
of Water Enforcement and Permits-NPDES Technical Support
Branch, Permits Division] is for instructional purposes only. It
was developed to illustrate the application of technical principles
of the NPDES regulations and does not necessarily represent offi-
cial policy of the U.S. EPA.

(1) All pollutants limited in permits shall have limi-
tations, standards or prohibitions expressed in terms
of mass except:

*

(ii) When applicable standards and limitations are
expressed in terms of other units of measurement.
(Emphasis added.)

This language seems to be in conflict with the Region's position that §§ 433.13 & .14's concentration limits are "merely factors" to be used in the process of calculating mass limitations; indeed, § 122.45(f)(1)(ii) appears to say that effluent limitations should be set in terms of concentration where applicable guidelines are expressed in terms of concentration. There may be a different interpretation that is more favorable to the Region's position in this proceeding; if so, I would like to hear it. Accordingly, I grant review for the limited purpose of providing the Region the opportunity to address its interpretation of 40 CFR § 122.45(f)(1)(ii).9 The Region's brief should be filed with this office no later than 30 days from the date of receipt of this Order and should include a thorough discussion of the regulatory history surrounding 40 CFR § 122.45(f)(1)(ii), including, but not necessarily limited to, 43 FR 37095 (August 21, 1978), 44 FR 34291 (June 14, 1979), and 45 FR 33342, 33451 (May 19, 1980). AT&T will have 30 days from receipt of Region VI's brief to file its response with this office.

Review of that portion of AT&T's petition relating to the effluent limitations for tin, iron, fluoride, and phosphorous is denied. Review of the remainder of AT&T's petition is granted and the parties are directed to file briefs pursuant to the schedule previously discussed.

So ordered.

940 CFR § 124.91(c)(1) permits me to limit the scope of review.

IN THE MATTER OF J.V. PETERS & COMPANY, INC.

RCRA (3008) Appeal No. 85-4

REMAND ORDER

Decided May 9, 1986

Before the Administrator, U.S. Environmental Protection Agency

Opinion by Ronald L. McCallum, Chief Judicial Officer:

Respondent, J.V. Peters & Company, Inc. (JVP), appeals from an Initial Decision by Administrative Law Judge Marvin E. Jones (Presiding Officer).1 In that Decision, the Presiding Officer "pierced the corporate veil" of JVP to hold Respondent corporation, David B. Shillman, President of JVP, and J.V. Peters and Company, a partnership and predecessor of Respondent corporation, in violation of regulations implementing the Resource Conservation and Recovery Act (RCRA) of 1976, as amended. He concluded as a matter of law that all three were jointly and severally liable for the violations, and he assessed a civil penalty of $25,000.2 For the reasons stated below, I vacate the Initial Decision and remand the case for proceedings consistent with this opinion.

I

J.V. Peters and Company, the partnership, operated a hazardous waste facility in Middlefield, Ohio, with the purpose of collecting industrial solvents, transporting them to the Middlefield site, and processing them for sale to a user or "reclaimant." The operation

140 CFR § 22.30 (1980) provides that initial decisions of presiding officers may be appealed to the Admininistrator or his delegatee.

2 As will be discussed in this opinion, there is some confusion as to the proper interpretation of the Presiding Officer's final order. All three entities were found liable for the violations charged, but it is unclear whether all three were held responsible for the civil penalty.

was under the complete authority of David B. Shillman.3 On December 17, 1980, a representative of U.S. EPA inspected the site and found multiple violations of RCRA and its implementing regulations.4

3 Although Shillman admits that he organized the partnership and managed its operations, he argues that he was not a partner.

4 Violations of the following regulations were found:

40 CFR § 265.13(a)(1): failure to obtain a detailed chemical and
physical analysis of representative samples of waste handled at
its facility prior to treatment and storage.

40 CFR § 265.13(b): failure to develop and follow a written waste
analysis plan.

40 CFR §265.14(b): failure to install either a barrier around the
active portions of the facility or 24-hour surveillance.

40 CFR § 265.14(c): failure to post signs bearing the legend "Dan-
ger-Unauthorized Personnel Keep Out" at each entrance to the
facility.

40 CFR §§ 265.15(b) and (d): failure to create and maintain at
the facility a written inspection schedule and log.

40 CFR § 265.16(d): failure to create and maintain at the facility
personnel records which list the job titles and describe the type
and amount of introductory and continuing training provided to
each hazardous waste management person.

40 CFR § 265.32(a): failure to have installed an internal commu-
nications system or alarm capable of providing emergency instruc-
tion to facility personnel.

40 CFR § 265.32(c): failure to maintain adequate fire extinguish-
ers, spill control and decontamination equipment at the facility.
40 CFR § 265.32(d): failure to have available at the facility water
at adequate volume and pressure, or foam-producing equipment,
automatic sprinklers or water spray systems.

40 CFR § 265.34(a): failure to have accessible, whenever hazardous
waste was being mixed, poured or otherwise handled, an internal
alarm or emergency communication device.

40 CFR § 265.35: failure to maintain aisle space to allow unob-
structed movement of personnel, fire control equipment, spill con-
trol equipment and decontamination equipment to any area of
the facility operation in an emergency.

40 CFR § 265.37: failure to make any arrangements with appro-
priate state and local emergency response officials.

40 CFR §§ 265.51 through 265.56: failure to create, maintain and
follow a contingency plan for the facility.

40 CFR §265.73: failure to create and maintain at the facility
a written operating record.

40 CFR §265.74: failure to make available, upon request and
at all reasonable times, all required records.

40 CFR § 265.173(a): failure to maintain containers of hazardous
waste, not being handled or processed, in a closed condition.

40 CFR § 265.176: storage of containers of flammable hazardous
waste within 15 meters (50 feet) of the property line of the facility.

On January 31, 1981, two weeks after receiving a copy of the inspection report and notice of potential enforcement action, the partnership was dissolved and its assets acquired by J.V. Peters & Company, Inc., the corporation.

On April 17, 1981, Complainant filed a complaint against Respondent J.V. Peters & Company, Inc., the corporation, alleging violations of RCRA and its implementing regulations. Although information was then or soon thereafter available to Complainant that JVP did not exist on the date of the alleged violations, this enforcement action progressed against the corporation alone. In September 1983, during continuing settlement negotiations, Complainant withdrew its original complaint without prejudice. An amended complaint was filed on February 7, 1984, again naming only the corporation as Respond

ent.

A hearing was held on October 23-25, 1984. At the close of Complainant's case-in-chief, Respondent moved to dismiss the case on the grounds that the corporation did not exist on the date of the alleged violations. The motion was denied. However, the Presiding Officer requested the parties to brief the issue in their post-hearing submissions and suggested that the equitable doctrine of "piercing the corporate veil" might be applicable to this case in some (unspecified) manner. Although Complainant opposed the motion to dismiss and alluded to the potential applicability of the equitable doctrine, it did not move during the hearing to amend the complaint to reflect that any other individual or organization had operated the business on the date in question.

In fact, Complainant did not move to amend its complaint to add any additional parties until prompted by a letter from the Presiding Officer on March 28, 1985, five months after the hearing had been adjourned. The letter referred to the transcript of the first day of testimony during which Complainant, in an unrelated matter, had made an oral motion to amend its complaint to conform the pleadings to evidence relating to an inspection of JVP's facility on December 8, 1980.5 The post-adjournment motion was also styled as a motion to conform the pleadings to the evidence, but unlike the earlier oral motion, it sought to amend the complaint to add

40 CFR §§ 265.110 through 265.115: failure to have and to activate

a closure plan for the facility.

5 The letter referred to Complainant's Motion to Amend appearing at page 43 of the Notes of Testimony (N.T.).