KATHERINE M. HAMILTON vs. CONSERVATION COMMISSION OF ORLEANS & another. [Note 1]

PERRETTA, J. The plaintiff wished to build a house on her land located on the shore of Cape Cod Bay in the town of Orleans. She filed a notice of her intent to do so with the defendant commission, as required under the Wetlands Protection Act, G. L. c. 131, Section 40, as amended through St. 1977, c. 131. The commission denied permission to proceed with the work described in her notice of intent, and she appealed to the Department of Environmental Quality Engineering (DEQE), which set numerous conditions on her plans to build. While of the belief that these conditions constituted a prohibition against construction of any house on the land, the plaintiff did not seek judicial review pursuant to G. L. c. 30A, Section 14, because, as she maintains, the DEQE's decision does not suffer from any of those defects specified in c. 30A, Section 14(7)(a) through (g). Rather, she accepted the decision of the DEQE and relies upon it as the basis of her present action against the defendants, in which she alleges that the commission's denial of her notice of intent and the final decision of the DEQE constituted a taking of her land without just compensation. The plaintiff's complaint was dismissed, without prejudice, pursuant to the defendants' motion to dismiss brought under Mass.R.Civ.P. 12(b)(6) and (7), 365 Mass. 755 (1974), and she appeals. We conclude that the plaintiff's action does not lie against these defendants, and we affirm the judgment of dismissal.

The record appendix includes the complaint, the motion to dismiss, a supporting affidavit from the chairman of the commission, and, by way of attachment to that affidavit, the decisions of the commission and the DEQE and the trial judge's memorandum of decision. This appeal turns on the propriety of the procedure followed by the plaintiff and not upon the factual basis for the denial of her notice of intent. Consequently, in reaching our decision we accept all of the factual assertions of the plaintiff, as supplemented by the defendants. See Lowell Gas Co. v. Attorney Gen., 377

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Mass. 37, 39 (1979); United States Fid. & Guar. Co. v. N.J.B. Prime Investors, 6 Mass. App. Ct. 455, 456 & n.2 (1978); Reiter v. Northampton, 10 Mass. App. Ct. 821 (1980). [Note 2]

The facts are as follows. The plaintiff, together with her husband prior to his death, has owned the land at issue for some twenty years. The northwest border of the property fronts directly on Cape Cod Bay and is approximately 350 feet long. The land is in an area zoned for residential use, and it has been assessed for purposes of real estate taxes at $50,000.

Because the plaintiff intended to build on land situated on the shoreline, she filed a notice of intent and the plans for the proposed construction project with the defendant commission on October 28, 1977, as required by G. L. c. 131, Section 40. [Note 3]

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We need not detail the reasons given by the commission for its denial; it is sufficient to relate that its decision was based upon a determination that the land on which the work was to be done was significant to those interests protected by Section 40 and that those interests would be endangered by the intended construction. In its decision the commission stated that it "has not considered and does not rule on at this time other activities which are of different size, materials, location, design, or type which the applicant may propose at a later date."

The plaintiff pursued her statutory right to request the DEQE to make its own determination on her proposal. On February 24, 1978, the DEQE issued its order of conditions which superseded the commission's and which allowed "the proposed work to proceed." The DEQE found that the project would not involve any of the interests specified in Section 40 and cited by the commission in its order of denial. The commission then requested that the DEQE reconsider its order. A "full adjudicatory hearing" was held before another DEQE hearing officer, and on February 14, 1980, the DEQE issued a "final decision" and order, setting out the following critical condition it deemed necessary to the protection of Section 40 concerns: "For the reasons stated more fully in the Final Decision of this date . . . the work proposed in the Notice of Intent and accompanying plans, as amended through this date, is prohibited. Nothing herein prohibits the filing of a new Notice of Intent provided that the Notice of Intent is supported by substantial evidence which shows

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that (1) any house would be constructed on pilings, (2) any subsurface sewage disposal system would comply with [310 Code Mass. Regs. Section 15.01, et seq. (1978)], (3) there would be a lawful, dependable and environmentally sound source of adequate potable water, (4) no work would occur, and no equipment or vehicles would intrude, seaward of any point 20 feet landward of the mean high water mark, and (5) no revetment shall be constructed."

The essence of the plaintiff's complaint is that the commission's proceedings and the DEQE's final decision "deprive[] [her] of all economically reasonable benefits of her said premises, and said decision appropriates so many of its rights and uses as to constitute a taking thereof." The primary basis for the trial judge's dismissal of the action was that if a taking had occurred, the DEQE and not the defendant commission was the taking authority, and, therefore, the plaintiff had failed to state a claim against the defendants on which relief could be granted; secondly, he concluded that the complaint should be dismissed because the plaintiff had failed to seek judicial review of the DEQE's decision under G. L. c. 30A, Section 14.

The question whether the DEQE's decision constitutes a taking of the plaintiff's land without compensation need not be decided on this appeal. We are required to determine only (1) whether the commission was a proper defendant in this action and (2) whether the plaintiff was required to seek judicial review of the DEQE's decision before commencing her action for a taking. [Note 4]

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1. Liability for Takings Resulting from Proceedings Under G. L. c. 131, Section 40.

The plaintiff argues that the DEQE is not a necessary party to her action because "the character of the order of conditions, whether made by the commission or as modified, if at all, by DEQE remains local in nature and effect upon the parcel for which application was initially made." Because of the history and the express language of Section 40, we do not agree with this contention.

The legislative history of Section 40 demonstrates that the Legislature has always reserved to the Commonwealth, acting through its various agencies, the final decision on applications for projects affecting statutory concerns as to wetlands protection. [Note 5]

Section 40 first appeared as G. L. c. 130, Section 27A, inserted by St. 1963, c. 426, and pertained solely to coastal wetlands. By that enactment, the Legislature delegated to the local authorities acting upon work project applications the limited power to "recommend" such "measures as may protect the public interest." [Note 6] The Department of Public Works was charged with the responsibility of enforcing the provisions of Section 27A as they related to certain waterways, see G. L. c. 91, Sections 30 and 30A, and the Director of Marine Fisheries was vested with the authority to "impose such conditions on said proposed work as he may determine necessary

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to protect such shellfish or marine fisheries, and work shall be done subject thereto." See Commissioner of Natural Resources v. S. Volpe & Co., 349 Mass. 104 (1965). [Note 7] Under the statute the Department of Public Works held veto power over projects within its jurisdiction. Golden v. Selectmen of Falmouth, 358 Mass. 519, 525 (1970).

Comparable protection for inland wetlands was established by G. L. c. 131, Section 117C, inserted by St. 1965, c. 220. When G. L. c. 131 was revised in its entirety by St. 1967, c. 802, Section 1, this section became part of the new c. 131, Section 40. Like G. L. c. 130, Section 27A, c. 131, Section 40, as appearing in St. 1967, c. 802, Section 1, required that notice of work projects on inland wetlands which involved statutory concerns be filed with local authorities, which could "recommend such protective measures as may protect the public interest." However, the power to "impose such conditions as may be necessary to protect the interests described herein" was legislatively delegated to the Commissioner of Natural Resources. The statute retained final say in the Commonwealth by further providing that if the Commissioner imposed conditions on the proposed work, "the work shall be done in accordance therewith."

Local conservation commissions had been established by G. L. c. 40, Section 8C, inserted by St. 1957, c. 223, Section 1, "for the promotion and development of the natural resources and for the protection of watershed resources of said city or town" accepting the statute. Statute 1971, c. 1020, and St. 1972, c. 510, added conservation commissions to those local authorities described in c. 131, Section 40, and c. 130, Section 27A, respectively.

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The next amendment of G. L. c. 131, Section 40, of any consequence to our analysis was by St. 1972, c. 784, which made Section 40 applicable to both coastal and inland wetlands and repealed c. 130, Section 27A. [Note 8] That amendment also gave local authorities greater power by no longer restricting them to the mere making of recommendations. The local authorities were given that which had been the exclusive function of the Commonwealth, namely, the powers "to impose such conditions as will contribute to the protection of the interests described herein" and to require that "all work shall be done in accordance" with any conditions that they might impose. These powers have been construed as including "a prerogative to prohibit construction" if necessary for the protection of the statutory interests. Lovequist v. Conservation Commn. of Dennis, 379 Mass. 7, 15 (1979). See 310 Code Mass. Regs. Section 10.02(28) (1980).

The legislative delegation of power to the local authorities did not, however, divest the Commonwealth of its right to the final say on project applications decided on the basis of those interests recited in Section 40. To the contrary, we read the 1972 amendment to Section 40 as expressly reserving this right to the Commonwealth, acting through the DEQE. [Note 9] Specifically, we look to that language in G. L. c. 131, Section 40, which provides that after a commission issues its decision, "the applicant, any person aggrieved by said commission's order . . . or any owner of land abutting the land upon which the proposed work is to be done, or any ten residents of the city or town in which such land is located, may . . . request the department of environmental quality engineering to determine" those identical concerns considered by the local authority.

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The importance of the State's interest in the local decision is evidenced in the provision that "[t]he commissioner of environmental quality engineering also may request such a determination." Moreover, the DEQE's determination and order "shall supersede the prior order of the conservation commission . . . and all work shall be done in accordance therewith." [Note 10] The determination can include an order prohibiting the activity. 310 Code Mass. Regs. 10.06(3) (1980).

The Commonwealth's power to speak with finality on wetlands is manifested throughout the Legislature's comprehensive, protective regulation in this area. [Note 11] The authority of local government in carrying out its role remains relatively circumscribed, and when acting under Section 40 rather than an ordinance or by-law, a city or town must make its determination solely in accordance with the minimum criteria

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therein recited. When acting under a by-law or ordinance, a local authority may regulate more strictly, but only in a fashion consistent with the statute. See Golden v. Selectmen of Falmouth, 358 Mass. at 526; Lovequist v. Conservation Commn. of Dennis, 379 Mass. at 15. Thus, where a local authority disapproves a proposed project pursuant to a by-law or ordinance which provides greater protection than Section 40, the applicant has no right to seek DEQE approval of the project on the basis that it would be acceptable under the statute. Rather, the applicant pursues those usual remedies available to one aggrieved by a decision of a local authority. See, e.g., MacGibbon v. Board of Appeals of Duxbury, 356 Mass. 635 (1970); Golden v. Selectmen of Falmouth, 358 Mass. at 520-521; Lovequist v. Conservation Commn. of Dennis, 379 Mass. at 15-16. Where, however, the local authority approves or disapproves an application under Section 40, the Commonwealth, through the DEQE, has the final word.

Given these limitations on local authorities, it is apparent that the Legislature has assigned to local authorities acting under Section 40 the role of making an initial review of an application for the familiar purposes of bringing local knowledge to bear on local conditions and reducing the administrative burden on a Statewide agency. Cf. Higginson v. Treasurer & Sch. House Commrs. of Boston, 212 Mass. 583, 584-585 (1912); Burnham v. Board of Appeals of Gloucester, 333 Mass. 114, 117 (1955). See generally Note, Coastal Wetlands in New England, 52 B.U.L. Rev. 724, 739-741 (1972). It may fairly and succinctly be said that when a local authority acts under Section 40, it does so as an "arm of the Commonwealth," Higginson v. Treasurer & Sch. House Commrs. of Boston, 212 Mass. at 585.

We conclude that Section 40 reserves to the DEQE the power to make the final decision on applications involving the specified concerns and to preserve thereby the Statewide interest in the protection of our wetlands. See Dawson, Protecting Massachusetts Wetlands, 12 Suffolk U.L. Rev. 755, 779 (1978). See also State v. Johnson, 265 A.2d 711, 716 (Me. 1970); Monroe v. Carey, 96 Misc. 2d 238, 242-243

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(Sup. Ct. 1977), aff'd, 46 N.Y. 2d 847 (1979). When Section 40 authority is exercised by the DEQE to prohibit a proposed project for purposes of protecting State interests, the DEQE, therefore, in the name of the Commonwealth, [Note 12] is the party which would bear the liability for any taking which results, [Note 13] cf. Westport v. County Commrs. of Bristol, 9 Allen 203 (1864); Flagg v. Bradford, 181 Mass. 315, 316 (1902), just as any other party who works a taking would be liable. See MacGibbon v. Board of Appeals of Duxbury, 356 Mass. at 641, and authorities therein cited. See also Note, Coastal Wetlands in New England, 52 B.U.L. Rev. 724, 752-762 (1972).

Our conclusion should not be construed as a signal to local communities to refrain from enacting strict wetland protection ordinances or by-laws in order to avoid liability for resulting takings. Cities and towns have clearly defined

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options available to them by reason of the fact that Section 40 "sets forth minimum standards only, `leaving local communities free to adopt more stringent controls.' Golden v. Selectmen of Falmouth, 358 Mass. [at] 526." Lovequist v. Conservation Commn. of Dennis, 379 Mass. at 15. Consequently, "[i]f the [local authority] intends and desires to preserve its remaining undeveloped coastal or inland wetlands in their natural, unspoiled condition for the enjoyment and benefit of the public, there are ways by which it may lawfully accomplish the purpose." MacGibbon v. Board of Appeals of Duxbury, 356 Mass. at 641. And where a taking is caused by the accomplishment of that purpose, it is the local authority which would bear the liability. It would, however, be anomalous to impose liability on the local authority where it has not elected or cannot afford to give priority to ecological concerns and has instead chosen to leave its coastal and inland wetlands to those protections extended by the Statewide standards set out in Section 40.

Accordingly, we hold that where the DEQE decides with finality that conditions are required by the minimum statutory standards and imposes them by a superseding order, it and not the local authority is liable for any taking which may thereby occur. The plaintiff, therefore, failed to state a claim upon which relief could be granted against the town or its conservation commission. Cf. Mitchell v. Metropolitan Dist. Commn., 4 Mass. App. Ct. 484, 487-489 (1976).

2. The Effect of the Plaintiff's Failure to Name the DEQE as a Defendant.

In dismissing the action "without prejudice," the trial judge apparently intended that the plaintiff would be at liberty to reinstitute her action and name the DEQE as the defendant after seeking judicial review of the DEQE's order under G. L. c. 30A, Section 14. Because we agree with the plaintiff's contention that she was not required to seek judicial review (see part 3 of this opinion, infra), we consider next whether the action should have been dismissed for "failure to join a party under Rule 19," as allowed by rule 12(b)(7).

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The plaintiff argues that if the DEQE is a necessary party, she should be allowed to amend her complaint because Mass.R.Civ.P. 21, 365 Mass. 767 (1974), expressly provides that "[m]isjoinder of parties is not ground for dismissal of an action." Moreover, our procedural rules have been liberally interpreted and applied in favor of saving actions by allowing amendments. See Castellucci v. United States Fid. & Guar. Co., 372 Mass. 288, 289 (1977); Perkins Sch. for the Blind v. Rate Setting Commn., 383 Mass. 825, 829-830 (1981). The problem in the present instance, however, is that the plaintiff's complaint is defective because of her failure to name as a defendant an indispensable party, as described in Mass.R.Civ.P. 19, 365 Mass. 765 (1974).

Rule 19(a) provides, in relevant part, that "[a] person who is subject to service of process shall be joined as a party in the action if (1) in his absence complete relief cannot be accorded among those already parties." Further, rule 19(b) states that "[i]f a person as described in subdivision (a)(1) . . . hereof cannot be made a party, the court shall determine whether in equity and good conscience the action should proceed among the parties before it, or should be dismissed, the absent person being thus regarded as indispensable." The difference between misjoinder and the failure to join an indispensable party, nonjoinder, has been discussed in relation to the cognate provisions of Fed.R.Civ.P. 19 and 21: "Although Rule 21 applies to nonjoinder, the first sentence of the rule, which prohibits dismissal of the action, refers only to misjoinder and makes no reference to a failure to join a party. The sentence was worded in this fashion to avoid conflict with the provision in Rule 19 authorizing the dismissal of the action when `in equity and good conscience' the action cannot proceed in the absence of one or more persons. However, the failure to join someone whose presence is desirable but not indispensable is not a ground for dismissal of the action under Rule 21. But when the absentee is regarded as indispensable under Rule 19(b), dismissal will be necessary. The court generally will afford plaintiff every opportunity to add the absentee to the suit before it will

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order dismissal of the action." 7 Wright & Miller, Federal Practice and Procedure Section 1684, at 329-330, and see Section 1686, and cases cited at n.61 (1972). See Smith & Zobel, Rules Practice Sections 21.2 and 21.3 (1975). See also United States v. Swink, 41 F. Supp. 98 101 (E.D. Va. 1941) ("Rule 21 was not adopted to give relief to a plaintiff who sues the wrong party, but to a plaintiff who sues too many parties, or not enough parties").

Although the trial judge could have afforded the plaintiff an opportunity to amend her complaint by adding the DEQE as a party before dismissing the action as to the present defendants, he did not do so, presumably because he also ruled that the complaint had to be dismissed for the plaintiff's failure to seek judicial review under G. L. c. 30A, Section 14. We need not consider, however, whether the plaintiff should be allowed to amend her complaint since the final order of the DEQE was issued on February 14, 1980, and an action against the DEQE is not yet barred by the two-year statute of limitations. See G. L. c. 79, Sections 16 and 18. In the circumstances of this case, we think it appropriate that the plaintiff proceed against the DEQE by pleading afresh rather than by amendment.

3. The Effect of the Plaintiff's Failure to Bring an Action Under G. L. c. 30A, Section 14.

The trial judge correctly ruled that the DEQE's decision was final within the meaning of G. L. c. 30A, Section 14. See J. & J. Enterprises, Inc. v. Martignetti, 369 Mass. 535, 539-541 (1976); Assuncao's Case, 372 Mass. 6, 8-9 (1977); Lahey Clinic Foundation, Inc. v. Health Facilities Appeals Bd., 376 Mass. 359, 370 (1978). He concluded, however, that the plaintiff's action should be dismissed nonetheless because she "has not exhausted the remedies for judicial review pursuant to G. L. c. 30A, Section 14." This ruling implies that a complaint for judicial review was the exclusive remedy available to the plaintiff following the DEQE order. Were the plaintiff challenging the correctness of the DEQE decision, we would agree with the trial judge. In commencing her suit for damages for a taking, however, the

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plaintiff accepted the correctness of the DEQE decision. Indeed, she states in her brief that "ample evidence was introduced to warrant the action taken by the DEQE, and that no procedural or other error was committed." See G. L. c. 30A, Section 14(7)(b) - (g).

The defendants advance two theories in urging that the plaintiff cannot proceed with her present action because she did not first seek judicial review of the DEQE's order. Their first contention is that an action for judicial review would have afforded the Superior Court "the opportunity to evaluate the correctness of the DEQE's decision, and to make a determination under Section 14(7) as to the validity of the agency's action." However, the Superior Court is not the last level of the administrative system, and it reviews agency decisions only when asked to do so by a person statutorily entitled to make such a request, i.e., one who is "aggrieved by a final decision of any agency in an adjudicatory proceeding." G. L. c. 30A, Section 14, as appearing in St. 1973, c. 1114, Section 3.

The defendants' second assertion is that review of a claim of a taking without just compensation by reason of agency action is available under Section 14(7)(a). [Note 14] Under that provision, they argue, a Superior Court judge could determine that the agency decision constitutes a taking without just compensation and set it aside or direct the plaintiff to bring an action for a taking. We do not agree that the Superior Court has the power under Section 14(7)(a) to set aside the DEQE's decision on the sole ground that the conditions thereby imposed under G. L. c. 131, Section 40, have resulted in a taking. Section 40, unlike G. L. c. 130, Section 105, G. L. c. 131, Section 40A, and G. L. c. 21, Section 17B, does not empower the Superior Court to exempt the land in question from conditions that the DEQE is mandated to impose under its provisions, leaving the

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DEQE with the right to take the land by eminent domain should it choose to enforce the conditions irrespective of the exemption. See note 13, supra.

The defendants would thus have us put the plaintiff to an action for judicial review for the limited purpose of determining whether the conditions imposed by the DEQE amount to a taking, and if the judge concluded in her favor, he would then direct her to bring an action for damages for that taking. By accepting the correctness of the DEQE decision and not challenging the validity of the taking, see Barnes v. Springfield, 268 Mass. 497, 503 (1929), cert. denied, 281 U.S. 732 (1930); Opinion of the Justices, 360 Mass. 894, 900 (1971), the plaintiff seeks to obtain complete relief in one proceeding, rather than two, and in this single proceeding the DEQE is free to raise the defense that the imposed conditions do not rise to the level of a taking. See, e.g., Tassinari v. Massachusetts Turnpike Authy., 347 Mass. 222 (1964); Davidson v. Commonwealth, 8 Mass. App. Ct. 541 (1979).

Additionally, there is nothing in Section 40 which requires us to view Section 14 as the plaintiff's exclusive remedy. Contrast G. L. c. 131, Section 39A, inserted by St. 1974, c. 842, Section 1 ("Any person aggrieved by an order of the department issued under the provisions of this section may appeal under the provisions of chapter thirty A. Such right of appeal shall be exclusive." During the same legislative session that the quoted provision was enacted as part of Section 39A, an identical provision in c. 131, Section 40, was deleted by St. 1974, c. 818, Section 1). There is no reason why the plaintiff should not be allowed to proceed by the most thorough and expeditious means available to her, and the trial judge erred in concluding that she was required to seek judicial relief under G. L. c. 30A, Section 14, before she could maintain her action for damages for an alleged taking.

4. The Right to Submit Future Proposals as Affecting the Plaintiff's Claim of a Taking.

As earlier noted, the DEQE's decision provided that the plaintiff could file a new notice of intent so long as it complied with the recited conditions. But, it is on the basis of

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those conditions, see note 4, supra, that the plaintiff argues that no construction can take place on her land. The trial judge noted in his memorandum of decision that, because the plaintiff could file new construction proposals, "it does not appear that [she] has yet reached the point where it must be said that, in effect, a taking of the land has been made." To the extent that that statement can be viewed as an additional basis for the judge's dismissal of the action under rule 12(b)(6), we deem it necessary to reach the issue because, under our earlier conclusion, the plaintiff is free to bring an action against the DEQE.

There is nothing to suggest that in the absence of this statement by the DEQE, the plaintiff could not submit new proposals. See 310 Code Mass. Regs. Sections 10.03, 10.05, and 10.06 (1980). Moreover, an administrative agency cannot foreclose an applicant from relying on an agency decision by inserting in its otherwise final order a provision like the one at issue here to require the applicant to submit yet another proposal as a precondition to an action in court. Since the essence of the plaintiff's complaint is that the conditions have the effect of precluding her from filing any future proposals, it would be error to dismiss the complaint under rule 12(b)(6) on such a basis without first determining the correctness of her assertion. The question of what future proposals might be held permissible by the DEQE under the conditions established by it goes to the very merits of the plaintiff's claim, i.e., whether those conditions deprive her of all "practical uses" of her land. Commissioner of Natural Resources v. S. Volpe & Co., 349 Mass. at 107.

5. Conclusion

Because the plaintiff's complaint does not state a claim upon which relief can be granted against the named defendants, the action was properly dismissed.

Judgment affirmed.