IN THE MATTER OF LICENSE OF CANADIAN RIVER LAND & CATTLE CO.

IN THE MATTER OF LICENSE OF CANADIAN RIVER LAND & CATTLE CO.
2011 OK CIV APP 117
Case Number: 108065
Decided: 10/13/2011
Mandate Issued: 12/05/2011
DIVISION I
THE COURT OF CIVIL APPEALS OF THE STATE OF OKLAHOMA, DIVISION I

IN THE MATTER OF LICENSE OF CANADIAN RIVER LAND & CATTLE CO.

CANADIAN RIVER LAND & CATTLE CO., Petitioner/Appellant,
v.
STATE OF OKLAHOMA ex rel., STATE BOARD OF AGRICULTURE, Respondent/Appellee.

APPEAL FROM THE DISTRICT COURT OF OKLAHOMA COUNTY, OKLAHOMA

HONORABLE TWYLA MASON GRAY, JUDGE

AFFIRMED

Philip Watts, Oklahoma City, Oklahoma, for Petitioner/Appellant,
James Woodruff, Oklahoma City, Oklahoma, for Respondent/Appellee.

ROBERT D. BELL, CHIEF JUDGE:

¶1 This is an appeal from a district court's order affirming an adverse final administrative order issued by Respondent/Appellee, the State Board of Agriculture (State)1, in an action for declaratory relief filed by Petitioner/Appellant, Canadian River Land & Cattle Co. (Canadian River). The final administrative order denied Canadian River's protest of State's transfer of a cattle feedlot license formerly owned by Canadian River to Robert A. and Nedra Funk (Funks). We hold the administrative order is free from error prejudicial to Canadian River and affirm the district court's order.

¶2 The following facts are undisputed. State issued Canadian River a Concentrated Animal Feeding Operation (CAFO) license pursuant to the Oklahoma Concentrated Animal Feeding Operations Act, 2 O.S. Supp. 2005 §20-1 et. seq. (the Act)2. The license permitted Canadian River to operate a large-scale cattle feedlot holding up to 3,000 animals on the specific real property described in the license. Pursuant to Oklahoma Administrative Code (OAC) 35:17-4-4(a)(2), (9) and (11) of the rules implementing the Act, a CAFO license is site specific. The CAFO license was renewable annually upon the payment of a $75.00 fee. Canadian River's license was due to expire June 30, 2004, by operation of law, unless the license renewal fee was paid. See 2 O.S. Supp. 2005 §20-16(A) and (B). It is undisputed Canadian River did not pay the license renewal fee in 2004 or thereafter.

¶3 The Oklahoma Department of Agriculture, Food and Forestry (Department of Agriculture) foreclosed on the real property described in the license and the Funks acquired the subject real property by Sheriff's Deed. The Deed did not purport to transfer or sell the CAFO license; it conveyed the land and fixtures that were the physical facilities associated with the CAFO license. On February 13, 2004, the Funks applied to have the license transferred from Canadian River's name to the Funks' name. The Funks' application was granted. In October 2004, written notice was given informing Canadian River that the CAFO license had been transferred to the Funks. Canadian River lodged a written protest to the transfer. State affirmed the transfer.

¶4 Canadian River filed an action in the district court for a declaratory judgment. The district court referred the matter to the appropriate administrative agency for exhaustion of administrative remedies. Canadian River then filed a petition for declaratory relief with State seeking to avoid the transfer of the CAFO license to the Funks. The matter was referred to a three person Ad Hoc Committee of the Department of Agriculture for review and a recommendation.

¶5 The Ad Hoc Committee submitted a written recommendation that made extensive findings of fact and conclusions of law and noted that Canadian River paid the renewal fee for 2003, but made no effort to pay any CAFO-related license fees after the license expired in June 2004. The Ad Hoc Committee recommended that Canadian River's petition for declaratory judgment be denied. After oral arguments, State accepted the recommendation and entered a final agency order ruling the transfer of the CAFO license was proper.

¶6 Canadian River appealed the final administrative order to the district court. The district court's comprehensive order, which is attached hereto as Exhibit "A," identified the proper standard of review for both the trial court and this Court on appeal, reiterated the undisputed facts, detailed the court's conclusions of law and affirmed the final administrative order. Canadian River now appeals from the district court's order.

¶7 On appeal, Canadian River argues: (1) The transfer of the CAFO license in this matter denies Canadian River the right to due process especially when there is no authority establishing that a CAFO license runs with the land in Oklahoma; and (2) State's decision to allow the involuntary transfer of the permit should have required a finding of fitness or suitability under Oklahoma law. The correctness of an administrative agency order was before the district court and is now before this Court. Under such circumstances, this Court's review is governed by the Oklahoma Administrative Procedures Act (APA), 75 O.S. 2001 §250 et seq. City of Tulsa v. State ex rel. Public Employees Relations Bd., 1998 OK 92, ¶12, 967 P.2d 1214, 1219. Under the APA, this Court's review is confined to the record made before the administrative tribunal. 75 O.S. 2001 §321.

¶8 Pursuant to §322(3) of the APA, an administrative decision should be affirmed if it is a valid order and the administrative proceedings are free from prejudicial error to the appealing party. Section 322(1) provides that a reviewing court may reverse an administrative order if an appealing party's substantial rights are prejudiced because the agency's decision is a violation of constitutional provisions, in excess of statutory authority or jurisdiction, entered based on an unlawful procedure or error of law or if the agency acted in an arbitrary and capricious manner or its findings are clearly erroneous in view of the reliable, material, probative and substantial competent evidence in the record. As to questions of fact, neither a district court nor this Court is entitled to substitute its judgment for that of the agency as to the weight of the evidence. City of Tulsa at ¶13, 967 P.2d at 1219.

¶9 Here, the district court affirmed the final administrative order. The district court found Canadian River had no license interest when the license was issued to the Funks because Canadian River ceased paying for the license and did not own the land where the license was situated. After reviewing the administrative record under the appellate review standards discussed above, we cannot find the district court's order which is attached hereto and marked Exhibit "A" was erroneous. Furthermore, since the district court's order correctly recited the undisputed facts, arrived at the appropriate conclusions of law and adequately explained its decision, we affirm the district court's order under Rule 1.202(d), Supreme Court Rules, 12 O.S. 2001, Ch. 15, App.

¶10 AFFIRMED.

HETHERINGTON, P.J., and HANSEN, J., concur.

FOOTNOTES

1 Effective May 6, 2002, the name of the State Department of Agriculture was Changed to the Oklahoma Department of Agriculture, Food and Forestry. Laws 2002, c.173.

2 In the proceeding below, the parties cited the 2005 version of the Act. The Act was renumbered in 2005 from Title 2 O.S. §9-200 et seq. by Laws 2005, c. 292, §25, effective July 1, 2005. Other than the renumbering, the relevant substantive language of the Act remained the same. The Act was then renumbered as 2 O.S. Supp. 2007 §20-40 through §20-64 by Laws 2007, c.31, §28, eff. November 1, 2007.

Exhibit "A"