11.20.2017 Prompt Reporting is Key to the Upset Defense By: Ryan W. Trail

Companies discharging industrial process wastewater often face challenging circumstances at their wastewater treatment facilities.  Unexpected equipment malfunctions or system failures can lead to discharges that exceed permitted limits.  If such an event occurs, most companies with a pretreatment or NPDES permit are aware that they can avoid being cited for a violation if the event qualifies as an “upset.”  However, a recent South Carolina case is a reminder that the upset defense is nuanced and difficult to assert successfully.

An upset is an exceptional incident where unintentional and temporary noncompliance with discharge permit limits occurs because of factors beyond the reasonable control of the permittee.  Incidents caused by operational error, improperly designed treatment facilities, inadequate treatment facilities, lack of preventative maintenance, or careless or improper operation, are considered within the reasonable control of a permittee and do not qualify as an upset.

If a permittee can prove the event was an upset, it may have a defense to an action brought for noncompliance.  To establish the defense, the permittee must identify the cause of the upset, show the facility was being properly operated at the time, give notice to the permitting agency with 24 hours of discovering the incident, and comply with all remedial measures required.

In Congaree Riverkeeper, Inc. v. Carolina Water Service, Inc., a recent decision by the U.S. District Court for the District of South Carolina, the court found the owner of a wastewater treatment facility failed to prove it qualified for the defense.  Evidence in the case showed that the NPDES permit issued to the permittee required notice to the permitting authority within 24 hours of discovering any noncompliance.  After determining notice was not given, the court denied the upset defense without even considering other arguments raised by the permittee. 

When facing noncompliance where an upset defense is possible, it’s easy for permittees to get caught up in the circumstances of the incident.  Thus, permittees often consider these questions:  Was the event caused by careless operation or lack of preventative maintenance? Was the event outside our reasonable control?  However, Carolina Water serves as a reminder that prompt and proper notification of the incident should always be the first thought.  Forgetting to give notice likely means your upset defense is gone. 

Congaree Riverkeeper, Inc. v. Carolina Water Service, Inc., 2017 WL 1176766 (D.S.C. March 29, 2017).