OYSTER HARBORS YACHT BASIN REALTY CORP. and OYSTER HARBORS YACHT BASIN, INC. v. RICHARD B. EGAN and AUDREY J. EGAN, as trustees of the 72 CROSBY CIRCLE REALTY TRUST; GREGORY R. EGAN, as trustee of the CROSBY YACHT YARD TRUST; RICHARD B. EGAN, as trustee of the CROSBY DOCKS TRUST; CROSBY YACHT YARD, INC.; and the DEPARTMENT OF ENVIRONMENTAL PROTECTION

Introduction

At issue in this case is the interpretation of the plaintiffs’ G.L. c. 91 licenses issued by the defendant Department of Environmental Protection (“DEP”). Specifically, the plaintiffs seek “a declaration and orders regarding the scope of rights of plaintiffs to use, under Chapter 91 licenses, a pier . . .” Third Amended Complaint for Declaratory Relief at 1 (Dec. 4, 2007). The pier in question is built over Commonwealth tidelands, subject to regulation by the DEP. [Note 1] The plaintiffs claim that their DEP licenses, License Nos. 95 and 7076, [Note 2] allow them to “moor[] . . . vessels of beam not greater than 20 feet to both sides of [their pier, ramp, and float] and allow[] [them] reasonable navigable access to the mooring locations on the structures.” Id. at 6. However, the licenses do not explicitly grant those rights. Rather, License No. 95 authorized the plaintiffs’ predecessors to build a timber catwalk approximately 128 feet long and three feet wide and License No. 7076 authorizes the plaintiffs to maintain the existing pier, float system and mooring piles, as well as to construct and maintain extensions of the piers. Both licenses state that they should not be construed to authorize encroachment on property not owned by the plaintiffs and that they are granted subject to all applicable federal, state, county and municipal laws.

Defendants 72 Crosby Circle Realty Trust, Crosby Yacht Yard Trust, Crosby Docks Trust, and Crosby Yacht Yard, Inc. (collectively, “Crosby Circle”), which own and operate an abutting boat yard to the north of the plaintiffs’ property, contend that the plaintiffs’ licenses neither expressly allow the plaintiffs to dock boats on the north side of the pier (the side abutting Crosby Circle’s boat yard and piers), [Note 3] nor reasonably can be interpreted to allow such uses. It also contends that the plaintiffs do not have a valid Army Corps of Engineering (“Army Corps”) permit that would allow them to dock boats on the north side of the pier. Finally, it contends that permitting the plaintiffs to dock boats on the north side of the pier interferes with Crosby Circle’s right to use the tidelands to navigate to and from its property.

On the eve of trial in this case, and perhaps prompted by the imminence of that trial, both the DEP and the Army Corps issued decisions that explicitly address the central issue in this case. Based upon the plaintiffs’ 2006 Chapter 91 license application, the DEP issued a draft license that authorizes the plaintiffs to “maintain existing structures, establish zones of reconfiguration and perform maintenance dredging.” This draft license states that the plaintiffs cannot “berth vessels with a beam greater than ten (10) feet on the northerly side of [the] pier, ramp and float.” It also references both License No. 95 and License No. 7076 and states that existing structures authorized under those licenses “shall be maintained in accordance with the conditions and terms of said licenses and plans.” The Army Corps decision prohibited the plaintiffs from berthing any vessels on the north side of the pier. As a result of these two decisions, the defendants have moved to dismiss the case based on the plaintiffs’ failure to exhaust their administrative remedies in the DEP and Army Corps proceedings. I agree with the defendants and dismiss the plaintiffs’ case.

Analysis

As stated above, in this case, the plaintiffs seek a declaratory judgment that interprets certain Chapter 91 licenses. In particular, the plaintiffs ask this court to determine that they have the right under those licenses to berth vessels of a beam up to twenty feet wide on the north side of the pier. Although “[t]he purpose of declaratory judgment is ‘to afford relief from uncertainty and insecurity with respect to rights, duties, status and other legal relations,’” this court must first have jurisdiction over the case in order to interpret the licenses and make such a determination. Town of Hingham v. Dpt. of Housing and Community Development, 451 Mass. 501 , 505 (2008) (quoting Massachusetts Ass’n of Indp. Ins. Agents and Brokers, Inc. v. Commissioner of Ins., 373 Mass. 290 , 291 (1977)); see also East Chop Tennis Club v. Massachusetts Commission Against Discrimination, 364 Mass. 444 , 450 (1973). It is well settled that in order for a court to have jurisdiction, there must be “an actual controversy – that is, a controversy appropriate for judicial resolution . . . .” Town of Hingham, 451 Mass. at 505. As in this case, when an administrative agency is involved, “there is no actual controversy in the absence of final agency action.” Id. As a result, a court does not have jurisdiction over a case involving a decision of an agency until the party has exhausted the administrative remedies. Id.; J. & J. Enterprises, Inc. v. Martignetti, 369 Mass. 535 , 539 (1976).

As the Supreme Judicial Court has stated,

[t]here are sound policy reasons for requiring exhaustion of administrative remedies. The [agency] should be given the opportunity to address the issues raised by the [plaintiff] so as to avoid the occurrence of untimely and piecemeal litigation. To permit judicial interference with the orderly administration by the [agency] of matters entrusted to it by the Legislature before it has [made] a final decision, would in effect transfer to the courts the determination of questions which the Legislature has left to the [agency], and would result in the substitution of the judgment of the court for that of the [agency].

Town of Hingham, 451 Mass. at 508 (internal citations and quotations omitted); see also Murphy v. Administrator of the Division of Personnel Administration, 377 Mass. 217 , 220 (1979) (“By permitting an agency to apply its expertise to the statutory scheme which it is charged to enforce, courts preserve the integrity of the administrative process while sparing the judiciary the burden of reviewing administrative proceedings in a piecemeal fashion.”). “Moreover, allowing the administrative process to run its course . . . gives the administrative agency in question a full and fair opportunity to apply its expertise to the statutory scheme.” Town of Hingham, 451 Mass. at 509 (internal citations and quotations omitted, ellipsis in original).

These policy reasons for the doctrine hold particularly true in this case. Although the licenses plaintiffs put in issue in this case (License Nos. 95 and 7076) constitute final agency decisions, both were silent as to whether the plaintiffs had the right to berth vessels on the north side of the pier. The DEP has recently issued a new draft license that, as one of its conditions, states that the plaintiffs cannot berth vessels with a beam greater than ten feet on the north side of the pier. In addition, the Army Corps has issued a provisional permit that prohibits berthing any vessels on the north side of the pier. These decisions thus reach the exact issue in this case – whether the plaintiffs can moor vessels on the north side of the pier and, if so, to what extent.

There are several advantages of requiring the plaintiffs to exhaust the administrative process and its associated appeals. First, the question of whether the plaintiffs can moor vessels on the north side of the pier involves an interpretation of the DEP’s own licenses. Surely, the DEP is in the best position to interpret what it meant when it issued those licenses and, in fact, has done so in its new draft decision. Although the plaintiffs contend that the DEP cannot interpret License nos. 95 and 7076 in the administrative process for the new draft license, the plaintiffs can argue in that process that the new DEP license is inconsistent with, or impermissibly revokes, the previously issued licenses. Second, the mooring question “involves technical questions of fact uniquely within the expertise and experience of [the DEP and Army Corps].” Murphy, 377 Mass. at 221 (internal citations and quotations omitted). The DEP and Army Corps are in the best initial position to determine those factual issues and then have them reviewed in the administrative process. Third and finally, requiring the plaintiffs to exhaust their administrative remedies will prevent potentially inconsistent results. If this court issued the judgment that the plaintiffs seek, the result would be an interpretation of License Nos. 95 and 7076 that allows the plaintiffs to moor vessels up to twenty feet, a new license from the DEP that limits those vessels to ten feet, and an Army Corps decision preventing them from mooring vessels altogether. [Note 4] Requiring the plaintiffs to exhaust their administrative remedies before resorting to a court proceeding resolves this potential for inconsistency for at least the DEP licenses.

Although there are exceptions to the exhaustion requirement, cases are clear that “[t]he instances are rare” and courts must be careful and cautious before invoking such exceptions. St. Luke’s Hospital v. Labor Relations Commission, 320 Mass. 467 , 470 (1946). The times to do so are generally limited to “when the administrative remedy is inadequate, when important, novel, or recurrent issues are at stake, when the decision has public significance, or when the case reduces to a question of law.” Town of Hingham, 451 Mass. at 509 (internal citations and quotations omitted). The court may also hear the case if the administrative agency is “acting under a statute that is violative of the Federal or a State Constitution, or where the board is dealing with a matter that is clearly beyond the scope of its authority . . . .” St. Luke’s Hospital, 320 Mass. at 470. None of these exceptions apply to this case. Although the plaintiffs contend that the agency is acting beyond its authority and is impermissibly broadening its jurisdiction to issue licenses, the licenses previously issued were silent as to whether the plaintiffs could moor boats on the north side of the pier. When the plaintiffs submitted a new application to the DEP for a Chapter 91 license that covers an area including the pier at issue in this case, it arguably was within the agency’s authority to include the condition relating to mooring boats on the north side of the pier under its Chapter 91 obligation “to preserve and protect the rights in tidelands of the inhabitants of the commonwealth,” G.L. c.91, § 2, and ensure that any license is not “detrimental of the public’s rights in these tidal lands,” G.L. c. 91, § 18. Further, even if the agency is acting beyond its jurisdiction, “the [DEP] should have an opportunity to ascertain the facts and decide the question for itself” in the circumstances of this case before court review takes place. St. Luke’s Hospital, 320 Mass. at 470.

The plaintiffs contend, based upon the doctrine of the “law of the case,” that I cannot dismiss this case for failure to exhaust administrative remedies because I previously denied the DEP’s motion to dismiss. Generally, “[w]here there has been no change of circumstances, a court or judge is not bound to reconsider a case, an issue, or a question of fact or law, once decided.” Peterson v. Hopson, 306 Mass. 597 , 599 (1940) (citations omitted). However, “the power to do so remains in the court until final judgment or decree.” Id. at 601 (emphasis added) (citations omitted); see also Boylston Housing Corp. v. O’Toole, 321 Mass. 538 , 545 (1947) (“A judge hearing a suit on its merits is not . . . precluded from dismissing a bill by reason of a prior interlocutory decree . . . even if such decree is not appealed from.”). “Even without rehearing, a judge may modify a decision already announced, so long as the case has not passed beyond the power of the court.” Peterson, 306 Mass. at 602. Furthermore, the “law of the case” doctrine “is permissive and not mandatory.” Potter v. John Bean Division of Food Machinery & Chemical Corp., 344 Mass. 420 , 427 (1962). Even if it were mandatory, the facts in this case have changed significantly since the earlier ruling regarding jurisdiction and exhaustion of remedies. Unlike the time when my initial decision was made, the DEP’s and Army Corps’ decisions have now made explicit determinations on the primary issue in this case. I am therefore more than entitled to decide differently than I did in the previous interlocutory order. The plaintiffs must now exhaust the administrative remedies available to them.

This memorandum and order does not in any way suggest that the DEP and Army Corps decisions were correct. [Note 5] Whether right or wrong, however, these recent decisions have resulted in this court no longer having jurisdiction over the case. As a result, “it is proper to dismiss [the] action for . . . declaratory relief, and to await judicial review if and when the administrative process results in an order affecting substantial rights.” J. & J. Enterprises, Inc., 369 Mass. at 539.

Conclusion

For the foregoing reasons, the defendants’ motions to dismiss are ALLOWED. The plaintiffs’ claims are dismissed, in their entirety, without prejudice to bring them again in an appropriate court once the plaintiffs have exhausted the administrative remedies. Judgment shall issue accordingly.

SO ORDERED.

By the court (Long, J.)