239 F.3d 400 (1st Cir.

2001)

UNITED STATES OF AMERICA, Plaintiff, Appellee,

v.
SAN JUAN BAY MARINA, SHOOTERS WATERFRONT
RESTAURANT, AND EDUARDO FERRER, Defendants,
Appellants.
No. 00-1759 & No. 00-1760

United States Court of Appeals For the First Circuit

Heard January 12, 2001
Decided February 21, 2001

ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR

THE DISTRICT OF PUERTO RICO
[Hon. Carmen Consuelo Cerezo, U.S. District Judge][Copyrighted
Material Omitted]
Eduardo A. Vera Ramrez, with whom Ramirez Lavandero, Landron &
Vera, L.L.P. was on brief, for appellant.
Camille Velez-Rive, Assistant United States Attorney, with whom
Guillermo Gil, United States Attorney, and Miguel A. Fernandez,
Assistant United States Attorney, were on brief, for appellee.
Before Boudin, Stahl and Lynch, Circuit Judges.
LYNCH, Circuit Judge.

The San Juan Bay Marina has a number of commercial establishments located
on piers in San Juan Harbor, including the Shooters Waterfront Cafe. Lacking
the necessary permits from the Army Corps of Engineers, the Marina
nonetheless built new piers and structures. These new constructions are located
in the San Antonio Channel, part of the navigable waters of the United States,
and so are subject to the Rivers and Harbors Act, 33 U.S.C. 403 et seq. The
United States brought an action against the Marina, the restaurant, and Eduardo
Ferrer, the President of both companies, to compel defendants to remove these

structures, in order to restore the waterways, and for a permanent injunction

against future illegal construction. The district court, on cross motions, entered
summary judgment for the United States and issued the injunctive relief.
2

On appeal, the Marina primarily points to the fact that it leases the original
piers from an entity of the government of Puerto Rico, the Puerto Rico
Industrial Company ("PRIDCO"), and surrounding areas from the Puerto Rico
Port Authority ("PREPA"). As such, it argues, the case should have been
dismissed because the government of Puerto Rico was an indispensable party to
the case. It also says that under the lease any "improvements" made to the
original property return to PRIDCO and that the United States cannot proceed
with this action without ascertaining whether Puerto Rico would like to have
these structures kept. In addition, it argues that the United States is required to
consider the public interest in considering whether to grant a permit and has not
done so. Finally, the Marina says there are genuine issues of material fact,
precluding entry of summary judgment for the United States.
I.

We describe the facts established by the record. After being denied an earlier
permit application, the Marina applied to the Corps, in April of 1992, to build
an 80 by 40 foot platform adjacent to -- and to become part of -- the original
structure. On May 18, 1992, the Corps issued a contingent permit, No.
199250101, for the construction. A contingent permit does not allow
construction to start until the permit conditions are met. The permit was
contingent on obtaining coastal zone certification or waiver from the Puerto
Rico Planning Board and Puerto Rico Environmental Quality Board. Neither a
certification nor a waiver was obtained. Despite this, the defendants went ahead
and built a platform. The platform was roughly 97 by 57 feet, larger than that
proposed in the application. The Corps issued a cease and desist order on July
5, 1995, after it had inspected the site.

In May of 1992, the Marina had filed for Nationwide Permit Number 3, to
reconstruct an existing pier. This type of permit authorizes the reconstruction
and rehabilitation of existing serviceable structures but does not permit
deviation from the original footprint. See 33 C.F.R. 330 et seq. (nationwide
permit program). The Marina then converted the pier from a wooden structure
to a reinforced concrete structure with additional piles. The problem is that the
pier was also constructed to twice its original size, in violation of the permit
conditions.
The Marina filed, on August 4, 1993, another permit application, No.

The Marina filed, on August 4, 1993, another permit application, No.

199350118, to construct a 40 by 44 foot expansion to the contingently
authorized 80 by 40 foot platform. The Corps again issued a contingent permit,
conditioned on receiving coastal zone certification from the Planning Board.
On December 29, 1993, the Commonwealth denied approval. Indeed the
Planning Board strongly objected to the proposed project. In February 1994, the
permit was denied by the Corps. Defendants took no appeal from the permit
denial. Nonetheless, defendants went ahead and constructed an addition of
approximately 40 feet by 57 feet. The net result of the construction was the
emergence of a continuous structure of roughly 137 by 57 feet, which houses a
terrace bar, a swimming pool, a deck, and ticket offices for a tour boat.

Without any permit application at all defendants also added another structure,
rhomboid in shape, of about 2800 square feet, for a "sushi bar." Indeed, the
construction started after the Corps had issued its July 1995 cease and desist
order to stop the other unauthorized work. The defendants also went ahead and
built yet another pier, about 300 feet long by 5 feet wide, without a permit. The
Corps issued an amended cease and desist order in September 1995 to take
account of these later two violations.

On November 30, 1995, defendants filed another permit application, after the
fact, to justify all of the unauthorized structures. Not surprisingly, the Corps
denied the application, saying it could not accept an after-the-fact permit from
someone who had been denied a permit and who would be subject to legal
action. This suit was then brought.
II.

Our review of the entry of summary judgment is de novo. Thomas v. Eastman

Kodak Co., 183 F.3d 38, 47 (1st Cir. 1999), cert. denied, 528 U.S. 1161 (2000).
We review an award of injunctive relief ordering removal and restoration for
abuse of discretion. United States v. Cumberland Farms of Conn., Inc., 826
F.2d 1151, 1164 (1st Cir. 1987), cert. denied, 484 U.S. 1061 (1988). A district
court's determination that a party is not an indispensable party can rest on a
determination under either Rule 19(a) or Rule 19(b) of the Federal Rules of
Civil Procedure. We have previously found it unnecessary to determine
whether the appropriate standard of review for Rule 19(a) decisions as to
necessary joinder is de novo or for abuse of discretion. See Tell v. Trustees of
Dartmouth Coll., 145 F.3d 417, 418-19 (1st Cir. 1998) (noting circuit split).
Since the outcome again would be the same under either standard, we refrain
from resolving this question. See id. at 418 (not resolving issue because not
relevant to outcome). Rule 19(b) determinations as to indispensable parties are

reviewed for abuse of discretion in this circuit. See Travelers Indem. Co. v.
Dingwell, 884 F.2d 629, 635 (1st Cir. 1989).
9

This case is set in the legal framework of the Rivers and Harbors Act of 1899,
33 U.S.C. 401. For more than a century, it has been the law that no one may
place obstructions into the navigable waters of this country without
authorization from the Army Corps of Engineers. See United States v.
Kennebec Log Driving Co., 491 F.2d 562, 565 (1st Cir. 1973); see also United
States v. Estate of Luis Boothby, 16 F.3d 19, 21 (1st Cir. 1994). The term
"obstruction" as used in this Act has a broad sweep. See Sanitary Dist. Co. of
Chicago v. United States, 266 U.S. 405, 429 (1925) (terming the section "a
broad expression of policy in unmistakable terms"), citing United States v. Rio
Grande Dam & Irrigation Co., 174 U.S. 690, 708 (1899) (giving the concept of
obstruction in the predecessor act a broad sweep; not limiting it to "a
prohibition of any obstruction to [ ] navigation," but instead construing the
section to reach "any obstruction to the navigable capacity, and anything,
wherever done or however done, . . . which tends to destroy the navigable
capacity of one of the navigable waters of the United States"); see also United
States v. Republic Steel Corp., 362 U.S. 482, 487-88 (1960) (noting "broad
sweep" given to the term). The term has been construed to include even the
deposit of certain refuse and waste materials, which violators may be ordered to
remove. See id. at 485, 491-92 (district court had authority under the River and
Harbor Act to issue injunctive restorative orders).

10

The key provision of the Act, for our purposes, is 403:

11

The creation of any obstruction not affirmatively authorized by Congress, to the

navigable capacity of any of the waters of the United States is prohibited; and it
shall not be lawful to build or commence the building of any wharf, pier,
dolphin, boom, weir, breakwater, bulkhead, jetty, or other structures in any port,
roadstead, haven, harbor, canal, navigable river, or other water of the United
Sates, outside established harbor lines, or where no harbor lines have been
established, except on plans recommended by the Chief of Engineers and
authorized by the Secretary of the Army; and it shall not be lawful to excavate
or fill, or in any manner to alter or modify the course, location, condition, or
capacity of, any port, roadstead, haven, harbor, canal, lake, harbor of refuge, or
inclosure within the limits of any breakwater, or of the channel of any
navigable water of the United States, unless the work has been recommended
by the Chief of Engineers and authorized by the Secretary of the Army prior to
beginning the same.

12

33 U.S.C. 403. Where navigable coastal waters, such as the San Antonio

channel, are involved, the Corps requires that Coastal Zone Management Act
certification be acquired. See 33 C.F.R. 320.4(h). The Coastal Zone
Management Act is a federal law administered by the National Oceanographic
and Atmospheric Administration, which, in turn, has delegated some authority
for administration to the States. See 16 U.S.C. 1451 et seq. Puerto Rico is
considered a state for these purposes, and administers the Act through the
Puerto Rico Planning Board.
13

The record is clear that defendants built structures without necessary permits.
Defendants attempt to avoid the removal, restoration, and cease and desist
orders on other grounds. In opposition to the motion of the United States for
summary judgment, defendants made four arguments: (1) the Government of
Puerto Rico was an indispensable party because it had a vested interest in the
property and owned the premises defendants occupied as tenants; (2) the Corps
should have approved the after-the-fact permit application because it was in the
public interest that the structures be built; (3) that same public interest meant
the plaintiff United States lacked standing to sue; and (4) the cease and desist
order was invalid because it was not signed by the correct person. Defendants
also argued that even if summary judgment was not entered for the defendants
on their cross-motion for these reasons, then at least summary judgment should
be denied to the United States, because there were material facts in dispute.
Essentially, the same arguments are raised on appeal.
A. Puerto Rico as an Indispensable Party

14

The question of whether Puerto Rico is an indispensable party is governed by

Rule 19, Fed. R. Civ. P. This is a two part inquiry. First, the party must be a
necessary party under Rule 19(a),1 Delgado v. Plaza Las Americas, Inc., 139
F.3d 1, 3 n.2 (1st Cir. 1998), and then it must be an indispensable party under
Rule 19(b).2 For a number of reasons, we agree with the district court that
Puerto Rico, through PRIDCO, is not a necessary party under Rule 19(a), and
so not an indispensable party under Rule 19(b).

15

Defendants argue under Rule 19(a) that the Commonwealth of Puerto Rico has
interests such that its absence from the action "may . . . as a practical matter
impair or impede the person's ability to express that interest." Fed. R. Civ. P.
19(a). It also argues under Rule 19(b) that the United States cannot have a
complete remedy unless the Commonwealth is a party. Defendants make the
usual Rule 19(b) argument that the absence of an indispensable party means the
action should be dismissed.

16

Defendants say that they are mere lessors, and the Commonwealth is the

16

Defendants say that they are mere lessors, and the Commonwealth is the
ultimate owner of the offending structures and so it must be made a party. This
position is contrary to the admission in the defendants' answer that the Marina
is the "sole owner" of all of the property in question, and with its position that
the Commonwealth has only a "vested" interest in the so-called improvements.
We bypass this inconsistency in defendants' position.

17

The PRIDCO lease with the Marina, in the same clause which permits
PRIDCO to take improvements at the end of the lease, makes the lessee
responsible for obtaining and complying with all applicable state and federal
permits.3 The requirement to get necessary permits from the Corps is repeated
in another clause.4 PRIDCO is authorized to cancel the lease for noncompliance with these provisions.5 PRIDCO has, by lease, assigned
responsibility for the permitting process and its consequences to defendants.

18

Defendants raise a pure issue of law: whether an owner is a necessary party

when a tenant makes "improvements" in property that are in violation of the
Rivers and Harbor Act. At the outset, we are dubious that the Commonwealth
is the present owner of the structures challenged by the Corps, given the lease
conditions. The lease describes the premises leased and does not purport to give
rights to build on the submerged lands next to the leased piers and premises.
While the leases may grant a reversionary interest to the lessors in
improvements on the leased property, the structures at issue here were not built
on the leased property, but on submerged lands outside the leased property.

19

Still, even if we assume that the Commonwealth will have some ownership
interest in the illegally constructed structures at the end of the lease, that
interest is insufficient to render it a "necessary party" under Rule 19(a). The
order here does not as a practical matter impair or impede the Commonwealth's
ability to protect its interest in the property it does indisputably own: the
original piers and original structures. The only remaining issue raised by
defendants is whether the court's order would "impede or impair" the
Commonwealth's ability to protect its purported reversionary interest in the
illegal structures upon the termination of the lease. However, a party is
necessary under Rule 19(a) only if they claim a "legally protected interest"
relating to the subject matter of the action. See, e.g., Northrop Corp. v.
McDonnell Douglas Corp., 705 F.2d 1030, 1043 (9th Cir. 1983). At present,
this reversionary interest is wholly contingent -- if defendants opted to raze the
structures on their own volition, the Commonwealth would have no legal
recourse. That defendants do so under court order makes no difference. Since
the relief ordered by the district court is complete, and concludes the
controversy without harm to any legally cognizable interest of the
Commonwealth, the Commonwealth is not a necessary party under Rule 19(a).6

20

We add that the Commonwealth, well aware of this situation, never moved to
intervene, and so it is apparently of the view that its interests either were not at
stake or were aligned with those of the United States. Cf. Fed. R. Civ. P. 19(a)
(2) (compulsory joinder appropriate where the person "claims an interest"
relating to the subject of the action that is threatened by litigation in his
absence) (emphasis added). Since its decision to forgo intervention indicates
that the Commonwealth does not deem its own interests substantially
threatened by the litigation, the court should not second-guess this
determination, at least absent special circumstances. See, e.g., Northrop Corp.,
705 F.2d at 1044; United States v. Sabine Shell, Inc., 674 F.2d 480, 483 (5th
Cir. 1982). Thus the requirements of Rule 19(a) have not been met.

21

Even if the Rule 19(b) analysis were reached, the Commonwealth, through
PRIDCO, would not be an indispensable party. SeeProvident Tradesmens Bank
& Trust Co. v. Patterson, 390 U.S. 102, 118-25 (1968) (finding that the mere
fact that absent parties' interests may be affected does not automatically render
that party indispensable within the meaning of Rule 19(b)). At present, there is
no reason to think that any judgment against defendants would prove to be
inadequate. Further, even were the Commonwealth a necessary party and an
indispensable party, as it is not, the Commonwealth could just be joined in the
action,7 and so there would be no reason to dismiss for lack of an indispensable
party.8
B. The Public Interest Standard

22

Defendants make a two-pronged argument regarding public interest, as best we

understand it. The first is that it is in the public interest that the permits be
issued, and the second is that, because this is so, the United States does not
have standing to pursue this enforcement action.

23

The most benign thing that can be said for these arguments is that they are
inventive. First, at the time, defendants did not seek review of the denial of the
permits under the Adminstrative Procedure Act, 5 U.S.C. 701 et seq., the
proper avenue for such a "public interest" challenge to an agency action. They
are foreclosed from collaterally attacking the denial of the permits in this
enforcement proceeding. Moreover, under the APA, such agency judgements
would be entitled to considerable deference, and the court shall not substitute its
judgment for that of the agency. See Citizens to Preserve Overton Park, Inc. v.
Volpe, 401 U.S. 402, 416 (1971) (abrogated on other grounds by Califano v.
Sanders, 430 U.S. 99, 105 (1977)); Trafalgar Capital Assocs., Inc. v. Cuomo,
159 F.3d 21, 26 (1st Cir. 1998), cert. denied, 527 U.S. 1035 (1999).

24

There would be no significant reason to question the agency's judgment here in

any case. The Corps is charged with the protection of the "navigable capacity"
of U.S. waters, such as the San Antonio Channel of the San Juan Bay, and must
consider a wide array of interests in the protection of these environmental
resources. The denial of the initial permits applied for was based on the
Commonwealth's refusal to grant coastal zone management certification;
accordingly, the position of the United States can hardly be said to be against
the public interest. In addition, the law requires the denial of the after-the-fact
attempts to get permission for structures as to which permits were denied or as
to which legal action has been determined to be appropriate. 33 C.F.R.
326.3(e); see alsoCumberland Farms, 826 F.2d at 1163 (Corps acted well
within its authority under 33 C.F.R. 326.4(c)(4) in denying after-the-fact
application). As to the structures built without even an application for a permit,
whatever the merits of a hypothetical application that was never made, it is
contrary to the public interest to permit the building of structures in navigable
waters without any permit application having been submitted.

25

Finally, the lack of standing argument is incomprehensible. Congress charged

the Corps with considering permit applications from those wanting to put
structures into navigable waters. Defendants here either were denied permits or
did not bother to apply for them. The United States plainly has standing under
the statute to enforce cease and desist orders and to seek the removal of
structures built in violation of law. See 33 U.S.C. 406; Cumberland Farms,
826 F.2d at 1163.
C. Summary Judgment: Material Facts

26

The Marina argues that there are material facts in dispute that preclude entry of
summary judgment. In particular it says that there are disputes of fact as to the
measurements of the structures at issue. It also argues that "there are genuine
controversies regarding the permit application process . . . that some or all of
the structures did not require the issuance of individual permits and/or were
authorized by plaintiff." We disagree. The record is quite clear that defendants
willfully violated the law. Further, these sort of overbroad arguments,
unsupported by specifics, amount to a waiver of the issue. Finally, defendants
say they would like to do some discovery which might lead to admissible
evidence. But no Rule 56(f) affidavit was filed, perhaps because it could not
have been filed in good faith, and so defendants are foreclosed.
D. Improper Signature

27

The final argument is that the cease and desist order may not be enforced

27

The final argument is that the cease and desist order may not be enforced
because the wrong person signed the orders. The initial cease and desist order
was signed by a Mr. Muniz for the District Engineer. This order was later
amended by a second order, which was signed by the Deputy District Engineer
of the Corps. The defendants contest Mr. Muniz's authority to sign the order,
relying on the language of 33 C.F.R. 326.3(c), which provides:

28

Once the district engineer has determined that a violation exists, he should take
appropriate steps to notify the responsible parties . . . . [T]he district engineer's
notification should be in the form of a cease and desist order prohibiting any
further work pending resolution of the violation . . ..

29

The argument is utterly meritless. As the district court noted, the District
Engineer is authorized to delegate his authority. See 33 CFR 325.8(b)
("permit need not be signed by the district engineer in person but may be signed
for and in behalf of him by whomever he designates"). Upon its review of the
record, the district court found that Mr. Muniz, as Chief of the Regulatory Field
Office, was properly authorized by established Corps policies to sign cease and
desist orders. If so, the authority was properly delegated. We see no reason to
disturb this finding.
III.

30

For these reasons we affirm the district court's entry of summary judgment for
the United States, and its order of enforcement.9 In light of the frivolous
arguments raised on appeal, we award double costs against defendants.10

Notes:
1

Rule 19(a) provides:

(a) Persons to be Joined if Feasible. A person who is subject to service of
process and whose joinder will not deprive the court of jurisdiction over the
subject matter of the action shall be joined as a party in the action if (1) in the
person's absence complete relief cannot be accorded among those already
parties, or (2) the person claims an interest relating to the subject of the action
and is so situated that the disposition of the action in the person's absence may
(i) as a practical matter impair or impede the person's ability to protect that
interest or (ii) leave any of the persons already parties subject to a substantial
risk of incurring double, multiple, or otherwise inconsistent obligations by
reason of the claimed interest. If the person has not been so joined, the court

shall order that the person be made a party. If the person should join as a
plaintiff but refuses to do so, the person may be made a defendant, or, in a
proper case, an involuntary plaintiff. If the joined party objects to venue and
joinder of that party would render the venue of the action improper, that party
shall be dismissed from the action.
2

Rule 19(b) provides:

(b) Determination by Court Whenever Joinder not Feasible. If a person as
described in subdivision (a)(1)-(2) 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 factors to be considered by the court
include: first, to what extent a judgment rendered in the person's absence might
be prejudicial to the person or those already parties; second, the extent to
which, by protective provisions in the judgment, by the shaping of relief, or
other measures, the prejudice can be lessened or avoided; third, whether a
judgment rendered in the person's absence will be adequate; fourth, whether the
plaintiff will have an adequate remedy if the action is dismissed for nonjoinder.

Clause Eight of the PRIDCO lease provides, in relevant part, that if PRIDCO
authorizes the lessee to build improvements, the "Lessee hereby commits itself
to submit evidence of all those necessary permits," be they state or federal,
required for the construction of the improvements.

Clause Sixteen of the lease provides that "Lessee shall comply with the laws
and/or rules, norms, regulations of all federal and/or state agencies applicable or
governing, related to its operations and in particular . . . [the] U.S. Corps of
Engineers . . .."

Clause Fourteen of the lease allows PRIDCO to cancel the lease for "noncompliance" with any of the provisions or conditions of the lease.

The defendant does not argue an alternative reason that the Commonwealth
might be considered a necessary party, but we pause to consider it in light of the
court's duty to protect the interests of absent parties. See, e.g., Provident
Tradesmens Bank & Trust Co. v. Patterson, 390 U.S. 102, 111 (1968) (urging
courts of appeal to raise nonjoinder issues on their own initiative "to protect the
absent party, who of course had no opportunity to plead and prove his interest
below"). The Commonwealth might have an interest relating to the subject
matter of this action because at some future point, the Corps could possibly
seek to compel the Commonwealth to remove the offending structures, should
the order stand but the defendants fail to comply with its dictates. We conclude
that this hypothetical possibility is insufficient to render the Commonwealth a

necessary party to this action. The absence of the Commonwealth in this action
would not impair or impede its ability to protect its interests. See Fed. R. Civ. P.
19(a)(2)(i). Nor would it threaten to leave the present defendants at risk of
incurring multiple or inconsistent obligations. Cf. Rule 19(a)(2)(ii). In any
subsequent action against the Commonwealth, it would be free to assert all of
its possible defenses, without being impaired by the outcome of the present
case. In these circumstances, and in light of the Commonwealth's decision not
to intervene, we do not find the Commonwealth to be a necessary party.
7

The district court misspoke when it gave as a reason for finding Puerto Rico
was not a necessary party that the Commonwealth could not be sued in federal
court by the United States. That is not so. See, e.g., United States v. Alaska,
503 U.S. 569 (1992) (holding state responsible under Rivers and Harbors Act);
United States v. Mississippi, 380 U.S. 128, 140-41 (1965).

On appeal, defendants have moved to supplement the record and to remand to

the district court, flourishing a letter purportedly from a Deputy Executive
Director of the Puerto Rico Industrial Development Company. That letter
asserts that this agency has an interest in keeping two of the offending
structures. We order the letter be stricken and deny the motion. Even assuming
dubitante that this letter is an authorized expression of interest on the part of the
Commonwealth in the retention of structures erected in violation of both federal
and Puerto Rico law, that expression of interest is too little, too late.
Throughout the district court proceedings, the Commonwealth of Puerto Rico,
which clearly knew of the dispute, never sought to intervene. Courts do not
initially decide permit applications and this belated effort to introduce evidence
is improper. See In re Colonial Mortgage Bankers Corp., 186 F.3d 46, 50 (1st
Cir. 1999) (new evidence proffered that was not properly before the trier of fact
cannot be considered on appeal), cert. denied, 528 U.S. 1139 (2000).

The judgment ordered "the defendants to expeditiously and without further

delay remove all referenced structures mentioned in all six claims."
Specifically, the judgment orders require removal of:
1. a contingently authorized 40 by 80 foot platform which was actually built to
dimensions of 97 by 57 feet in violation of Permit No. 199250101;
2. that portion of the pier reconstruction of Nationwide Permit #3 which
exceeds the original dimensions;
3. the platform, with a minimum size of 2,800 square feet built without the
Corps permit after issuance of the Cease and Desist Order;
4. the 300 by 5 foot pier constructed without a permit and restore the navigable

waters of the United States to their pre-construction condition; removing all

material, wood, concrete, plastic or construction-related debris in a sound and
environmentally correct manner, said materials to be deposited in an upland site
previously approved by the Corps.
It also permanently enjoined the defendants "from further construction in
navigable waters of the United States without first having obtained permits
from the Corps and after complying with all conditions imposed by said
permits."
10

For assessment of double costs in cases raising frivolous arguments, see

Hawkins v. Rhode Island Lottery Comm'n, 238 F.3d 112, 114 (1st Cir. 2001).