Odyssey Capital Group III, L.P., d/b/a Cascades Apartments

Plain-English summary

Odyssey owned and operated a nine-building apartment complex in Pittsburgh where maintenance employees scraped and repainted pre-1981 ceiling material. The company took none of the asbestos precautions required by OSHA because two earlier environmental studies had reported less than one percent asbestos in limited samples. After an employee's test found five percent asbestos, the company declined a request for more testing, while later government and media testing confirmed asbestos above the regulatory threshold. The Commission held that the earlier studies did not follow the sampling and analysis methods required to rebut the standard's presumption that sprayed-on material in pre-1981 buildings contains asbestos. It affirmed ten serious citation items addressing exposure limits and the related controls, monitoring, protective equipment, training, cleanup, and competent-person requirements. The total penalty remained $10,500.

Decision snapshot

• Cited standard(s): 29 C.F.R. § 1926.1101(c)(1), § 1926.1101(c)(2), § 1926.1101(e)(1), § 1926.1101(k)(7)(i), § 1926.1101(f)(1)(i), § 1926.1101(f)(2)(i), § 1926.1101(g)(1)(i), § 1926.1101(g)(1)(ii), § 1926.1101(k)(3)(i), § 1926.1101(h)(1)(i), § 1926.1101(i)(1), § 1926.1101(j)(1)(i), § 1926.1101(k)(9)(i), § 1926.1101(l)(2), and § 1926.1101(o)(1)
• Outcome: The Commission affirmed all ten serious citation items and the ALJ's total penalty assessment of $10,500.
• Key point: Limited environmental studies do not rebut the asbestos standard's presumption unless their sampling and analysis satisfy the methods specified by the rule.

Full text (OSHRC public release)

SECRETARY OF LABOR,
Complainant,
v. OSHRC Docket No. 98-1745
ODYSSEY CAPITAL GROUP III, L.P.,
d/b/a CASCADES APARTMENTS,
Respondent.

                                   DECISION

Before: ROGERS, Chairman, VISSCHER and WEISBERG, Commissioners.
BY THE COMMISSION:
The issue before the Commission is whether the judge erred in affirming ten serious
violations of the Asbestos in Construction Standard, 29 C.F.R. § 1926.1101, by the
Respondent, Odyssey Capital Group III, L. P. (“Odyssey”), d/b/a The Cascades Apartments
(“Cascades”). Cascades argues that it lacked knowledge of the violative conditions because
it reasonably relied on two prior environmental studies which indicated that asbestos hazards
did not exist at the worksite. For the following reasons, we reject Cascades’ arguments and
affirm the judge’s findings of violations and penalty assessment of $10,500.
In 1991, Odyssey purchased The Cascades apartment complex, which consists of
about 146 one- and two-bedroom rental apartments in nine two-story buildings in Pittsburgh,
Pennsylvania. In 1998, Cascades’ employees performed maintenance work, including
scraping and repainting of the ceilings, in various apartments. It is undisputed that Cascades
implemented none of the asbestos-related precautions prescribed by OSHA standards. After
commencing the work, the employees became concerned about possible exposure to
asbestos, and one employee had a sample of ceiling debris tested. That test indicated that the
sample contained five percent asbestos, and the employees notified Cascades’ project
manager of the test results. Although Cascades refused the employees’ request for further

                                                                  2000 OSHRC NO. 42

2

testing, subsequent tests by a local television station, the Allegheny County Health
Department, and the Secretary’s Occupational Safety and Health Administration (“OSHA”),
confirmed the presence of asbestos in amounts exceeding OSHA’s standard. On September
17, 1998, OSHA issued the citation on review here.
In its defense, Cascades points to a “Phase I environmental study” that was done for
Odyssey’s financing entity in 1991, and to another such study done in 1995, when Odyssey
refinanced The Cascades.1 Three samples of ceiling surfacing material in the apartments
were analyzed for each study, and the reports stated that no sample contained as much as one
percent asbestos. The relevant OSHA asbestos standards apply to materials that contain
“more than 1 percent asbestos” (asbestos-containing material (ACM)), and to materials
presumed to contain asbestos (presumed asbestos-containing material (PACM)).2 29 C.F.R.
§ 1926.1101(b). PACM includes sprayed- or troweled-on surfacing material contained in
buildings constructed before 1981. See also 29 C.F.R. § 1926.1101(k).3 It is undisputed that

   1
   Roger Morse, an expert on asbestos issues, testified that the purpose of a Phase I site

assessment is to protect a lender from a Superfund action under the Comprehensive
Environmental Response and Compensation Liability Act (“CERCLA”).
2
The Preamble to the Asbestos in Construction Standard explains the reason for the
presumption that certain materials contain asbestos:

  [I]n the past, employers who were wrongly informed by building owners
  about the asbestos content of thermal system insulation successfully argued
  in some cases that they had exercised "due diligence." OSHA believes that the
  protection of employees must not depend on the good faith of their employers
  whose information sources may be defective. By requiring that TSI [thermal
  system insulation] and troweled- and sprayed-on surfacing material be handled
  as if they contain asbestos, employees will be protected from the consequences
  of their employers relying on erroneous information about the most risky
  asbestos materials.

59 Fed. Reg. 40,964, 41,014-15 (1994).
3
The key provisions state:
(k) Communication of hazards. (1) This section applies to the communication
(continued...)
 3

3
(...continued)
of information concerning asbestos hazards in construction activities to
facilitate compliance with this standard. Most asbestos-related construction
activities involve previously installed building materials. Building owners
often are the only and/or best sources of information concerning them. . . .
Employers and building owners shall identify TSI [thermal system insulation]
and sprayed or troweled on surfacing materials in buildings as asbestos-
containing, unless they determine in compliance with paragraph (k)(5) of this
section that the material is not asbestos-containing. . . . When communicating
information to employees pursuant to this standard, owners and employers
shall identify "PACM" [presumed asbestos-containing material] as ACM
[asbestos-containing material]. . . .
(k)(5) Criteria to rebut the designation of installed material as PACM. (i) At
any time, an employer and/or building owner may demonstrate, for purposes
of this standard, that PACM does not contain asbestos. Building owners
and/or employers are not required to communicate information about the
presence of building material for which such a demonstration pursuant to the
requirements of paragraph (k)(5)(ii) of this section has been made. However,
in all such cases, the information, data and analysis supporting the
determination that PACM does not contain asbestos, shall be retained
pursuant to paragraph (n) of this section.
(ii) An employer or owner may demonstrate that PACM does not contain
more than 1 percent asbestos by the following:
(A) Having a completed inspection conducted pursuant to the
requirements of AHERA [Asbestos Hazard Emergency Response Act,
15 U.S.C. §§ 2641 et seq.] (40 CFR Part 763, Subpart E) which
demonstrates that the material is not ACM; or
(B) Performing tests of the material containing PACM which
demonstrate that no ACM is present in the material. Such tests shall
include analysis of bulk samples collected in the manner described in
40 CFR 763.86. The tests, evaluation and sample collection shall be
conducted by an accredited inspector or by a CIH [certified industrial
hygienist]. Analysis of samples shall be performed by persons or
laboratories with proficiency demonstrated by current successful
participation in a nationally recognized testing program such as the
National Voluntary Laboratory Accreditation Program (NVLAP) or the
National Institute for Standards and Technology (NIST) or the Round
Robin for bulk samples administered by the American Industrial
Hygiene Association (AIHA) or an equivalent nationally-recognized
(continued...)
 4

the Cascades Apartments, which were built between 1974 and 1979, contained sprayed-on
acoustic paint on the ceilings that Cascades maintenance employees repaired in the
apartments at issue.
An employer may overcome the presumption that sprayed- or troweled-on surfacing
material in pre-1981 buildings is ACM, if it establishes that an analysis of bulk samples
collected in the manner described in 40 C.F.R. § 763.864 shows that the surfacing material
does not contain more than one percent asbestos. 29 C.F.R. §§ 1926.1101(k)(1), (5).
Cascades has not shown that it conducted the prescribed sample collection or analysis, nor
does it contend that it had.
DISCUSSION
At issue is whether “the employer knew or, with the exercise of reasonable diligence,
could have known of the presence of the violative condition.” George Campbell Painting
Corp., 18 BNA OSHC 1929, 1933, 1999 CCH OSHD ¶ 31,935, p. 47,389 (No. 94-3121,
1999).5 The record shows that Cascades was aware of all the conditions constituting the

   3
   (...continued)
          round robin testing program.

(Some emphasis added). The cited Asbestos in Construction Standard, 29 C.F.R.
§ 1926.1101, took effect on October 11, 1994.
4
Those regulations were promulgated by the U. S. Environmental Protection Agency
under AHERA. Both the 1991 and 1995 Phase I studies involved only three samples. Even
if the ceiling material were completely homogeneous throughout the nine buildings (a
disputed issue at the hearing), there were 17,000 square feet of the material. Thus, at least
seven random samples would be necessary under 40 C.F.R. § 763.86(a)(3), in order to rebut
the presumption of asbestos-containing material in section 1926.1101(k)(1). The Phase I
studies also did not indicate that the samples were collected in a statistically random and
representative manner or by an accredited inspector. Cf. 40 C.F.R. § 763.86(a) (“An
accredited inspector shall collect, in a statistically random manner that is representative of
the homogeneous area, bulk samples from each homogeneous area[, and at least] seven bulk
samples shall be collected from each homogeneous area that is greater than 5,000 ft2”)
(emphasis added).
5
See Astra Pharmaceutical Prods., 9 BNA OSHC 2126, 2129, 1981 CCH OSHD
(continued...)
 5

violation. It knew that the apartment ceilings which its employees maintained and repaired
had been constructed before 1981, and that many of them contained sprayed-on surfacing
material. It does not dispute that the 1991 and 1995 Phase I environmental site assessment
studies on which it relies were not AHERA-compliant, nor did they involve collection of
bulk samples in the manner described in 40 C.F.R. 763.86.6
Cascades nevertheless argues that it may rely on those studies to establish that it was
reasonably diligent in determining that the apartments did not contain sufficient asbestos to
trigger application of the cited OSHA standards. In support of this argument, Cascades cites
three Commission decisions which found employers’ scientific monitoring efforts to
constitute reasonable diligence, even though OSHA’s subsequent testing showed, contrary
to those monitoring results, that employees were exposed to violative levels of hazardous
substances. Milliken & Co., 14 BNA OSHC 2079 (No. 84-767, 1991), aff’d, 947 F.2d 1483
[15 BNA OSHC 1373] (11th Cir. 1993) (cotton dust); General Electric Co., 9 BNA OSHC
1722, 1727-28 (No. 13732, 1981) (asbestos tubing being cut with table saws); Dunlop v.
Rockwell Int’l, 540 F.2d 1283 (6th Cir. 1976) (asbestos dust generated by brake grinding
operation). Unlike those cases, however, this one involves a standard that in effect defines
what constitutes reasonable diligence under it. The standard requires the employer to take

   5
    (...continued)

¶ 25,578, pp. 31,899-900 (No. 78-6247, 1981) (listing the four elements of Secretary’s prima
facie case, the last of which is a showing that the employer either knew or could have known
of the condition with the exercise of reasonable diligence), aff’d in pertinent part, 681 F.2d
69 (1st Cir. 1982).
6
In fact, those studies provide specific disclaimers regarding the reliability of their
limited asbestos findings. The 1991 study states: “When very small percentages of asbestos
are present,” the method the study used (Polarized Light Microscopy (PLM)) “can miss
detecting asbestos.” It further noted that “sampling was limited” and that “[f]urther
sampling, and analysis using Transmission Electron Microscopy (TEM) could clarify the
percentage of asbestos content[.]” The 1995 study states: “This environmental assessment
. . . is intended solely for the information and benefit of [the lender]. It may not be relied
upon by you in any other connection.” The Phase I studies do not even suggest that they
meet any OSHA criteria.
 6

precautions unless specific testing, done in a way that was not done here, shows that the
material involved contains no more than one percent asbestos.7 As noted, there is no dispute
that Cascades did not take the requisite precautions. We therefore find that Cascades knew
or reasonably could have known that the ceiling surface material at issue was PACM, and
that it failed to conduct the specific testing called for in the Asbestos in Construction
Standard or comply with the related requirements of that standard. Thus, the judge did not
err in affirming the ten violations.
Penalties
Cascades argues that the judge’s penalty assessments, which totaled $10,500 for 10
serious violations, are excessive. The Secretary argues that the judge’s penalty assessments
are “eminently reasonable.” The ten violations, and the penalties assessed for each, are
summarized in Appendix A (copy attached). Cascades does not dispute OSHA’s test results
which, as mentioned, showed more than one percent of asbestos content in five of the six
bulk samples it took of sprayed-on ceiling material. The judge found all the violations
serious, because they may result in asbestosis or mesothelioma, which are debilitating or
fatal illnesses.

   7
     Even assuming that Cascades was unaware of the presumption incorporated in

section 1101(k), that would be at most ignorance of the law, which is no excuse for its
failure to comply. E.g., Cheek v. United States, 498 U.S. 192 (1991) (citing Shevlin-
Carpenter v. Minnesota, 218 U.S. 57, 68 (1910) (“ignorance of the law will not excuse”).
See, also, e.g., Ed Taylor Constr. Co. v. OSHRC, 938 F.2d 1265, 1272 (11th Cir. 1991)
(“Whether or not employers are in fact aware of each OSHA regulation and fully understand
it, they are charged with this knowledge and are responsible for compliance”) (citing North
Ala. Express, Inc. v. United States, 585 F.2d 783, 787 n.2 (5th Cir. 1978)); United States v.
Green Drugs, 905 F.2d 694, 696 (3d Cir.), cert. denied, 498 U.S. 985 (1990) (citing
Shevlin); Kenneth P. Thompson Co., 8 BNA OSHC 1696, 1704, 1980 CCH OSHD
¶ 24,593, p. 30,179 (No. 76-2623, 1980) (“Respondent is presumed to have knowledge of
the cited standard by virtue of its publication in the Federal Register.”) The judge also relies
on the past professional experience of Odyssey’s President, John Kirwin, with asbestos
litigation as an additional ground for rejecting Cascades’ reliance on those studies.
 7

   Under the Occupational Safety and Health Act, the Commission must give “due

consideration . . . to the appropriateness of the penalty with respect to the size of the business
of the employer being charged, the gravity of the violation, the good faith of the employer,
and the history of previous violations.” 29 U.S.C. § 666(j). The judge found:
As to gravity, two, perhaps three employees were exposed intermittently over
a period of years prior to the hiring of an independent asbestos removal
contractor. The gravity of the violation is not low because exposure was
expansive in time although limited as to the number of employees exposed.
The judge gave Cascades no credit for good faith, based on the underlying facts showing a
lack of reasonableness in its reliance on the 1991 and 1995 reports, and its refusal to
investigate potential asbestos violations even after employees submitted a test showing more
than one percent asbestos in its ceiling materials. The judge found “no direct evidence as
to the size of the employer’s business,” and “no history of prior violations.” (Cascades
represents on review that its annual gross revenue is approximately one million dollars.)
The judge therefore assessed the Secretary’s proposed $1500 penalty for Item 1,
which involved the violation of permissible exposure limits (PEL) for airborne asbestos. As
to the other citation items, he noted that there “is no dispute that Respondent was not in
compliance with any of the requirements of the standards cited.” Each of those violations
arguably could result in increased asbestos exposure of an employee. The judge assessed
$1000 for each of them rather than the Secretary’s $1500 proposed penalties, in part because
he found their gravity lower than that of the PEL violation.
Cascades argues that those penalties are “inappropriate in light of the technicality of
Respondent’s violation of 29 CFR § 1926.1101(k)(3)(i)” and the other cited provisions.
Cascades’ violations are not merely “technical,” however. They exposed employees to
regulated amounts of asbestos, which has been shown to cause death and serious illnesses,
and Cascades took no precautions to limit that exposure or protect its employees.
Accordingly, the judge’s penalty assessments are justified.
 8

 Thus, we affirm the judge’s findings of violations and the penalty assessments. SO

ORDERED.

                                                /s/
                                                Thomasina V. Rogers
                                                Chairman


                                                /s/
                                                Gary L. Visscher
                                                Commissioner


                                                /s/
                                                Stuart E. Weisberg
                                                Commissioner

Dated: November 21, 2000
 9

Secretary of Labor v. Odyssey Capital Group III, L.P. d/b/a Cascade
Apartments
Docket No. 98-1745

                           Appendix A
              Citation Items, Standards and Penalties

Item Cited Standard Description of Penalty
29 C.F.R. Alleged Violation
1926.1101
Subsection
1a (c)(1) Asbestos exposure in excess of permitted 1500
8 hour time-weighted average.
1b (c)(2) Asbestos exposure in excess of thirty
minute “excursion limit.”
2a (e)(1) Class I asbestos work not performed 1000
confined to a “regulated area.”
2b (k)(7)(i) Lack of warning signs demarcating a
regulated area.
3a (f)(1)(i) Lack of asbestos exposure monitoring in 1000
known asbestos work area.
3b (f)(2)(i) Failure to designate competent person to
perform asbestos exposure assessment in
asbestos work area.
4a (g)(1)(i) Lack of dust collectors with HEPA filters 1000
in asbestos work area.
4b (g)(1)(ii) Lack of wet methods or wetting agents to
control asbestos exposure in asbestos
work area.
4c (k)(3)(i) Failure to identify presence, location and
quantity of asbestos or presumed asbestos
containing material.
5 (h)(1)(i) Failure to provide appropriate respirators 1000
for work in a Class I asbestos area
6 (i)(1) Failure to provide appropriate protective 1000
clothing for work in a Class I asbestos
area.
 10

Item Cited Standard Description of Penalty
29 C.F.R. Alleged Violation
1926.1101
Subsection
7 (j)(1)(i) Failure to provide a decontamination area 1000
for employees working in an asbestos
area.
8 (k)(9)(i) Failure to institute asbestos training 1000
program for employees likely to be
exposed to asbestos.
9 (l)(2) Failure to collect asbestos containing 1000
scrap in sealed, labeled impermeable bags
or containers.
10 (o)(1) Failure to have a person designated as a 1000
competent persons for asbestos work
areas.
 UNITED STATES OF AMERICA
OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION

SECRETARY OF LABOR,
Complainant,
v OSHRC DOCKET No. 98-1745
ODYSSEY CAPITAL GROUP III, L.P.
d/b/a CASCADE APARTMENTS,
Respondent.

Appearances: Anthony G. O’Malley, Esq.
Office of the Solicitor
U.S. Department of Labor
For the Complainant

                  Daniel J. Sporrer, Esq
                         Salamon & Sporrer
                         Pittsburgh, Pennsylvania
                         For the Respondent

BEFORE: MICHAEL H. SCHOENFELD,
Administrative Law Judge

                            DECISION AND ORDER

Background and Procedural History

   This case arises under the Occupational Safety and Health Act of 1970, 29 U.S.C. § § 651 -

678 (1970) ("the Act").
Having had its worksite inspected by a compliance officer (“CO”) of the Occupational Safety
and Health Administration (“OSHA), Respondent was issued one serious citation containing 10
items alleging various violations regarding protecting employees against overexposure to asbestos.
Respondent timely contested. A hearing on the matter took place in Pittsburgh, Pennsylvania on
July 14 and 15, 1999. Closing briefs have now been filed by both parties.
Jurisdiction
It is undisputed that at the time of this inspection Respondent was engaged in the ownership
and operation of an apartment complex. Respondent does not deny that it uses tools, equipment and
supplies which have moved in interstate commerce. I find that Respondent is engaged in a business
affecting interstate commerce.
Based on the above finding, I conclude that Respondent is an employer within the meaning
of § 3(5) of the Act.8 Accordingly, the Commission has jurisdiction over the subject matter and the
parties.

Discussion
Most simply put, this is a case in which the Secretary showed that asbestos was present in
excessive amounts, while the employer had earlier measurements indicating that the asbestos
concentration was not excessive. The Secretary, however, has fulfilled her burden of establishing
that the employer’s failure to discover the excessive asbestos concentrations resulted from a failure
to exercise reasonable diligence.
Respondent, Odyssey Capital Group III, L. P. (“Odyssey”), purchased the Cascade
Apartments (“the Apartments”) in Pittsburgh, Pennsylvania in August 1991; it also began to manage
the property at that time. In 1991, when Odyssey bought the property, and again in 1995, when the
property was refinanced, a “Phase I environmental study” was done on behalf of the financing entity.
See, GX-5 (“1991 report”) and GX-6 (“1995 report.”) The 1991 report, in part, stated that three
samples of building surfacing materials were taken and that testing revealed that “one sample
contained less than one percent [asbestos] and no asbestos was found in the other two samples.” The
1995 report stated that the samples submitted did not contain asbestos.9
In 1998, two employees, whose duties included scraping and removing loose ceiling paints
and sealants from water-damaged areas of the apartments, became concerned about possible
exposure to asbestos after one of them saw a television documentary about the subject. The
employees first raised their concerns with the building manager. Based on her experience as a
“certified sales person,” she told the employees that she did not feel that the Apartments would have
been purchased or refinanced if there were an asbestos problem (Tr. 222). Within a few weeks, the

       8
           Title 29 U.S.C. § 652(5).
       9
    Appendix C, Table 1 of the 1995 report shows that three samples were tested,

which contained less than 1%, less than 5% and 0% asbestos. (GX-6, 7).
employee took his own sample of the debris from the scraping, had it analyzed, and presented the
results (“PSI test”) to the building manager. The building manager relayed the PSI test results to
Odyssey’s President, who responded by fax that he had the 1991 and 1995 reports showing that no
dangerous levels of asbestos were present (Tr. 226-28. See also, Tr. 61-64; 67-69; 110; 142-43 and
157-58.). The building manager requested of the owner that another asbestos test be performed. The
president declined to do so (Tr. 230). The two employees refused to work in the apartments they
suspected contained asbestos and they were consequently fired. In addition, there is reliable and
creditable evidence in the record that after the two employees were fired, at least one person, who
was hired as a supposed independent contractor, continued the removal work in the same manner
as the fired employees (Tr. 166; 206 and 234-35). Following the firing of the employees additional
asbestos testing by the county health department, a local television station and OSHA all confirmed
the presence of asbestos containing materials. (GX-1, GX-7).
Under 29 C.F.R. § 1926.1101, the OSHA standard regulating asbestos exposure in
construction work, any material containing more than 1 percent asbestos is classified as “asbestos
containing material (ACM).”10 The employees’ activities in scraping and removing “ACM” was
“Class I asbestos work.”11 Where “Class I asbestos work” is being performed, until the employer
demonstrates otherwise, employees are presumed to have been exposed to asbestos in amounts
exceeding the permissible exposure limits under both the eight hour time-weighted average and the
thirty minute “excursion” limit requirements.12
The central dispute here is whether Odyssey’s reliance on the 1991 and 1995 reports, which
it reads as demonstrating that no ACM was present, thus justifying its taking no asbestos precautions
at the Apartments, is reasonable.13 If Odyssey’s reliance on the 1991 and 1995 reports was

   10
      See, Title 29 C.F.R.§ 1926.1101(b). It is also noted that since the apartments were

constructed no later than 1980, any “thermal system insulation and surfacing material” in the
buildings is “presumed asbestos containing material.”“) PACM Id.
11
Id.
12
Title 29 C.F.R. § 1926.1101(f)(2)(ii)
13
As Respondent stated in its pre-trial statement:
[t]he primary legal issue in the instant action is whether
Respondent was justified in its reliance upon two (2) separate
Phase I environmental studies, performed in 1991 and 1995,
respectively by qualified firms, that indicated there was not
(continued...)
reasonable, it did not and could not have reasonably known of the violative condition at least until
it was confronted with 1998 test data.14
According to the Secretary, the 1991 and 1995 reports could not reasonably have been relied
on to show that he materials being scrapped and removed at the Cascade Apartments in 1998
contained less than 1 percent asbestos. The Secretary maintains that the 1991 and 1995 reports would
have put a reasonably diligent employer on notice that further inquiry into asbestos presence was
warranted at that time. She claims that further testing would have revealed the presence of asbestos
in excess of 1 percent, as did the tests conducted by the County Department of Health on June 26,
1998 and by OSHA on July 10, 1998. See, GX-1 - 3.
Several Commission decisions are apropos. The Commission has held that the Secretary fails
to prove the “knowledge” element of an alleged violation where the employer had conducted earlier
atmospheric tests that did not show that employees were exposed to excessive levels of airborne
contaminants. North American Rockwell Corp., 2 BNA OSHC 1710 (Nos. 2692 and 2875, 1975),
affirmed sub nom Dunlop v. Rockwell International, 540 F.2d 1283 (6th Cir. 1976). See Miliken &
Co., 14 BNA OSHC 2079, 2083 (No. 87-0767, 1991). Prior testing cannot, however, rise to the
level of a defense unless the data is reliable. Even where the data is reliable, the prior testing cannot
constitute such a defense unless the employer’s reliance on the data is reasonable. Id.

    13
     (...continued)
           ACM (Asbestos Containing Material) at The Cascades
           Apartments.
    The United States Court of Appeals for the Sixth Circuit rejected the Secretary’s

contention that whether an employer has been reasonably diligent within the meaning of §
17(k) of the Act is a question of law noting that what an employer knows and what actions
it took are questions of fact. Dunlop v. Rockwell International, 540 F.2d 1283, 1288 (6th
Cir. 1976).

    14
      There can be no serious violation of the Act as alleged unless the employer knew

or using “reasonable diligence” could have known of the existence of the violative
condition. See, Act, § 17(k), 29 U.S.C. § 666(j). In general, to prove a violation of a
standard, the Secretary must demonstrate by a preponderance of the evidence (1) that the
cited standard applies, (2) non-compliance with the terms of the standard, (3) the employee
exposure or access to the hazard created by the non-compliance, and (4) that the employer
knew, or with the exercise of reasonable diligence could have known of the condition. Astra
Pharmaceutical Products, Inc., 9 BNA OSHC 2126, 2129 (No. 78-6247, 1981); Dun-Par
Engineered Form Co., 12 BNA OSHC 1949 (No. 79-2553), rev’d & remanded on other
grounds, 843 F.2d 1135 (8th Cir. 1988), decision on remand 13 BNA OSHC 2147 (1989).
 For the following reasons, based upon all of the facts and circumstances in this case, I find
that the record demonstrates that Odyssey’s lack of knowledge as to the presence of asbestos
containing materials at the Apartments was due to its failure to act in a reasonable and diligent
manner.
John P. Kirwin, Odyssey’s president, made the relevant determinations and decisions for
Respondent regarding the operation of the Apartments. (Tr. 427-432). It is clear from the testimony
and evidence that he made the decision to dismiss the complaints and asbestos test results the
employees gave him and to maintain, in the face of contrary evidence, that there was no asbestos
problem at the Apartments. Based upon his education and experience, I find untenable his claim that
before learning of 1998 asbestos test results, the 1991 and 1995 reports gave him no cause to further
investigate possible asbestos problems that would arise from the scraping and removing of insulating
paints and sealants at the Apartments. The information and inferences that may be gleaned from
documents such as the 1991 and 1995 reports depend, in significant part, upon the education and
awareness of the reader. And Mr. Kirwin’s claimed naivete in interpreting the reports is totally
inconsistent with his background. Mr. Kirwin is an experienced real estate dealer who has been a
practicing lawyer with specific experience in asbestos litigation. He is also involved in the purchase
of a number of properties, and he has had at least one prior involvement is a property purchase with
similar asbestos issues (Tr. 441). Mr. Kirwin testified that he was “surprised” when the 1991 report
“did not show thresholds of asbestos.” (Tr 455). He also testified that he had examined the property
and he in effect, conceded that he anticipated that the 1991 report would raise asbestos issues. When
it did not, he simply ignored his own background, preferring to accept at face value a report he had
reason to question since this might have raised difficulties in the purchase of the property.
In addition to the above, the 1995 report states that the sampling was “limited” and that
“further sampling and analysis using Transmission Electron Microscopy (TEM) could clarify the
percentage of asbestos content.” (GX 5). If the authors of the 1995 report were satisfied that the
asbestos testing was adequate and the results clear, there would have been no need to suggest
additional sampling and another testing technique. Mr. Kirwin’s background, along with his
understanding of the high degree of danger associated with asbestos exposure, is inconsistent with
his testimonial insistence that the 1991 and 1995 reports in no way raised any question that further
testing might be required. Moreover, in assessing his testimony I have taken into account Mr.
Kirwin’s financial interest in maintaining and increasing the value of the Apartments (See, Tr. 399-
400) as well as his demeanor as a witness. At the outset, Mr. Kirwin clearly tried to give the
impression of being a sincere businessman, but one with far less sophistication than his age and
experience would suggest. As his examination went on, however, his extensive real estate
experience and legal background became apparent in his choice of language and use of technical and
legal terms. In short, his testimony was that of a person being less than fully candid until it became
necessary to do so and the overall impression was one of false sincerity.
Finally, in addition to the above, I give full credit and significant weight to the testimony of
Roger Morse. He opined that Respondent’s reliance on the 1991 and 1995 reports as showing a lack
of asbestos at the Apartments was unreasonable in terms of the knowledge and general principles
of the real estate industry (e.g., Tr. 401) even taking into account that the reports were somewhat
“atypical.” (Tr. 416-20).
Citation 1, Items 1 and 1b - - 29 C.F.R. § § 1926.1101(1)(c)(1) and 1101(c)(2)

   For the above reasons, Respondent’s reliance on the 1991 and 1995 reports was unreasonable

and it thus knew or reasonably should have known that the paint scraping activities would produce
asbestos containing materials and thus is presumed to have had employees exposed to asbestos in
amounts exceeding the permissible exposure limits under both the eight hour time-weighted and the
thirty minute “excursion” limit requirements. Respondent was thus in violation of the standards at
29 C.F.R. § 1926.1101(c)(1) and 1101(c)(2) as alleged in Citation 1, Items 1a and 1b. Accordingly,
Citation 1, items 1a and 1b are AFFIRMED.
There is no doubt that exposure to asbestos in levels exceeding the threshold limit value for
an eight hour time-weighted average and for a thirty minute “excursion limit” are both “serious”
within the meaning of section 17(k) of the Act, 29 U.S.C. § 666(j), of the Act. They may be the
cause of asbestosis or mesothelioma which are debilitating or fatal illnesses. Dravo Corp., 7 BNA
OSHC 2095, 2101, (No. 16317, 1980), pet. for review denied, 639 F.2d 772 (3d Cir. 1980).
Accordingly, Citation 1, Items 1a and 1b are found to be serious.
In determining appropriate penalties for violations, including those classified as willful,
“due consideration” must be given to the criteria under section 17(j) of the Act, 29 U.S.C. 666(j).
Those factors include; the size of the employer’s business, gravity of the violation, good faith and
prior history. While the Commission has noted that the gravity of a violation is generally “the
primary element in the penalty assessment,” it also recognizes that the factors “are not necessarily
accorded equal weight.” J.A. Jones Construction Co., 15 BNA OSHC 2201, 2214 (No. 87-2059,
1993) In this case, the evidence is no direct evidence as to the size of the employer’s business. As
to gravity, two, perhaps three employees were exposed intermittently over a period of years prior
to the hiring of an independent asbestos removal contractor. The gravity of the violation is not low
because exposure was expansive in time although limited as to the number of employees exposed.
Respondent has no history of prior violations. Finally, for all of the reasons discussed regarding its
lack of reasonableness in relying on the 1991 and 1995 reports, I find that Respondent cannot be
credited with good faith. Under these circumstances, I find that the penalty of $1500 as proposed
by the Secretary for Citation 1, Items 1a and 1b is appropriate.
Citation 1, Items 2a, 2b, 3a, 3b, 4a, 4b, 4c, 5, 6, 7, 8, 9 and 10. -- Various sub-sections of 29 C.F.R.
§ 1926.110115

   Each of the remaining items and sub-parts of the citation issued to Respondent allege

violations of the Act for the failure to comply with various sub-sections of the standard at 29 C.F.R.
§ 1926.1101 which, as a whole, regulates asbestos exposure in construction. There is no dispute
that Respondent was not in compliance with any of the requirements of the standards cited.
Once asbestos exposure is established (in this case, by the presumption under 29 C.F.R. §
1926.1101(f)(2)(I)), the employees must have the full panoply of asbestos exposure protection. Here,
it is undisputed that Respondent had the belief, albeit in error, that was no asbestos containing
materials at the site so as to trigger the need for an entire asbestos protection program. Citing the
absence of separate, distinguishable elements of a complete asbestos protection program as separate
violations is, however, not a redundancy, where, as here compliance with one of the standards does
not necessarily result in compliance with the others. Under Commission precedent citations are
duplicative where they involve substantially the same violative conduct. Flint Engineering & Constr.
Co., 15 BNA OSHC 2052, 2057 (No. 90-2873, 1992). Two citations have been found to have been
duplicative where compliance with one necessarily resulted in compliance with the other. Capform,
13 BNA OSHC 2219 (No. 84-0556, 1989). Although they are separate violations, Items 2 through
10 flow from Respondent’s reliance on the 1991 and 1995 reports and are thus integrally related.
Moreover, the gravity of each of the violations in items 2 through 10 is lower than that of item 1
which deals with the actual overexposure to asbestos. All else remains the same. As such, they do
not warrant separate penalties of $1500 each. Under these circumstances, I find that a penalty of
$1000 each for items 2,3,4,5,6,7,8 ,9 and 10 is appropriate.

                                  FINDINGS OF FACT


   All findings of fact necessary for a determination of all relevant issues have been made

above. Fed. R. Civ. P. 52(a). All proposed findings of fact and conclusions of law inconsistent with
this decision are hereby denied.

                               CONCLUSIONS OF LAW


   15
        See Appendix A, Attached.

1. Respondent was, at all times pertinent hereto, an employer within the meaning of section
3(5) of the Occupational Safety and Health Act of 1970, 29 U. S. C. § § 651 - 678 (1970).
2. The Occupational Safety and Health Review Commission has jurisdiction over the parties
and the subject matter.
3. Respondent was in violation of section 5(a)(2) of the Act in that it failed to comply with
the standards as alleged in Citation 1, Items 1, 2, 3, 4, 5, 6, 7, 8, 9 and 10.
4. Each and every one of the violations of the Act found above was serious.
5. A civil penalty of $1,500 is appropriate for Item 1.
6. A civil penalty of $ 1000 is appropriate for each of the violations in
Items 2, 3, 4, 5, 6, 7, 8, 9 and 10.

                                           ORDER


    1. Citation 1, Items 1, 2, 3, 4, 5, 6, 7, 8, 9 and 10 are AFFIRMED.
    2. A civil penalty of $ 10,500 is assessed.




                                                           /s/
                                                    Michael H. Schoenfeld
                                                    Judge, OSHRC

Dated: 11-29-99
Washington, D.C.
 Secretary of Labor v. Odyssey Capital Group III, L.P. d/b/a Cascade
Apartments
Docket No. 98-1745

                             Appendix A
                         Decision and Order
   Itemization of Citation Items, Standards and Proposed Penalties

Item Cited Standard Description of Proposed
29 C.F.R. Alleged Violation Penalty
1926.1101
Subsection
1a (c)(1) Asbestos exposure in excess of permitted 1500
8 hour time-weighted average.
1b (c)(2) Asbestos exposure in excess of thirty
minute “excursion limit.”
2a (e)(1) Class I asbestos work not performed 1500
confined to a “regulated area.”
2b (k)(7)(I) Lack of warning signs demarcating a
regulated area.
3a (f)(1)(I) Lack of asbestos exposure monitoring in 1500
known asbestos work area.
3b (f)(2)(I) Failure to designate competent person to
perform asbestos exposure assessment in
asbestos work area.
4a (g)(1)(I) Lack of dust collectors with HEPA filters 1500
in asbestos work area.
4b (g)(1)(ii) Lack of wet methods or wetting agents to
control asbestos exposure in asbestos
work area.
4c (k)(3)(I) Failure to identify presence, location and
quantity of asbestos or presumed asbestos
containing material.
5 (h)(1)(I) Failure to provide appropriate respirators 1500
for work in a Class I asbestos area
6 (I)(1) Failure to provide appropriate protective 1500
clothing for work in a Class I asbestos
area.
Item Cited Standard Description of Proposed
29 C.F.R. Alleged Violation Penalty
1926.1101
Subsection
7 (j)(1)(I) Failure to provide a decontamination area 1500
for employees working in an asbestos
area.
8 (k)(9)(I) Failure to institute asbestos training 1500
program for employees likely to be
exposed to asbestos.
9 (l)(2) Failure to collect asbestos containing 1500
scrap in sealed, labeled impermeable bags
or containers.
10 (o)(1) Failure to have a person designated as a 1500
competent persons for asbestos work
areas.