author: KLAPHAKE, Judge.

text:
    STATE of Minnesota, Respondent, v. Charles Robert WALKER, Appellant.
    No. A04-1099.
    Court of Appeals of Minnesota.
    May 17, 2005.
    Petition for Review Denied July 19, 2005.

      Mike Hatch, Attorney General, Tibor M. Gallo, Assistant Attorney General, St. Paul, MN; and Alan L. Mitchell, St. Louis County Attorney, Duluth, MN, for respondent.
    John M. Stuart, State Public Defender, Jodie L. Carlson, Assistant State Public Defender, Minneapolis, MN, for appellant.
    Considered and decided by KLAPHAKE, Presiding Judge, TOUSSAINT, Chief Judge, and PETERSON, Judge.
   OPINION

KLAPHAKE, Judge.

Appellant Charles Robert Walker and his co-defendant wife, Dawn Walker, were charged with aiding and abetting each other in the commission of felony check forgery and theft in violation of Minn.Stat. §§ 609.05, 609.631, subd. 2(1), 609.52, subd. 2(1) (2002). The charges arose from allegations that over a period of several months in 2002, Dawn Walker had issued unauthorized checks to herself and appellant from the account of their employer, Kodiak Home Improvement Company, and that they had taken certain movable property from their employer.

At the Walkers’ request, the cases were consolidated for trial. Prior to trial, Dawn Walker’s attorney withdrew. On the first day of trial, the parties moved to allow appellant’s attorney to jointly represent them, and the district court granted that request. Following a two-day trial, the jury returned verdicts finding both parties guilty.

Because the district court failed to engage in an affirmative inquiry to determine whether appellant validly waived his right to have a separate attorney and because the state failed to show beyond a reasonable doubt that a ■ prejudicial conflict of interest did not exist during trial, we reverse and remand.

FACTS

In 1999, Tim Morgan, the. owner of Kodiak Home Improvement Company (Kodiak), hired appellant’s wife, Dawn Walker, She. was initially hired, as a receptionist, but soon was given additional responsibilities, including the authority to write checks on Kodiak’s business account. In early 2002, Morgan gave Dawn Walker a pay increase, and she became the office manager and assumed additional duties, such as planning jobs and running the day-to-day affairs of the office. Dawn Walker had full access to all the company records and was in the process of transferring the information from company ledger books into the computer.. During this time, appellant also worked for Kodiak as a subcontractor and mechanic. .

In July 2002, after Morgan injured his shoulder, he spent less time fin the office and on job sites. At the end of August 2002, he had surgery. During this time period, Morgan claimed that he relied more on Dawn Walker to run the business and did not closely monitor her.

On October 22, 2002, after Morgan had been back to work for a few weeks, Dawn Walker informed him that the office computer had gone down due to a power failure and that she was unable to operate it. She then called in sick for the next three days, and the following Monday, October 28, she telephoned the office and left a message that she was quitting.

Morgan did not know how to get the computer running, and his attempts to reach Dawn Walker were unsuccessful. Morgan asked another Kodiak employee to help him with the computer. This employee was able to get the computer operational in about half an hour. Once operational, however, it was discovered that most of the business financial records were gone. Morgan was unable to locate the computer disk containing backup information, and the parallel paper records were either missing or incomplete. The check ledger book contained incomplete or deleted entries, and the entries ceased in September 2002. Morgan attempted to contact Dawn Walker, but she did not return his calls.

Some time earlier, Morgan had indicated to appellant that he was not satisfied with his performance on several jobs. Morgan testified that appellant became angry, picked up some tools, threw them into his truck, and left the job site. Morgan claimed that some of the items belonged to Kodiak, including an electric cutting shear, caulking supplies, and paint. Morgan further claimed that appellant had taken an inoperable one-ton Dodge truck without Morgan’s permission. Although Morgan admitted that he had agreed to sell the truck to appellant, he claimed that they had never settled on a price; Morgan estimated that the truck was worth approximately $400 to $600.

On November 14, 2002, police received information from a reliable informant that Dawn Walker had issued unauthorized checks on the Kodiak business account to herself and appellant. Morgan was contacted by police and turned over evidence of what he believed were unauthorized or suspicious transactions.

Police thereafter executed a search warrant at the Walker residence. They found items that Morgan claimed belonged to Kodiak, including Office Depot business credit account cards for Kodiak; an Office Depot computer floppy disk, which was marked as “Kodiak backup disk 1”; a reciprocating saw and a circular saw; two aluminum ladder jacks; a box containing ten tubes of caulk; four boxes of siding material or shingles; and other documents imprinted with the Kodiak business logo.

After searching cancelled checks and other financial records that he had, Morgan identified 79 checks that he believed were relevant to the investigation, dating back to March 2002. The total dollar amount of 78 of those checks was $65,181.21; a final check for $3,000 was not paid because it was presented after Morgan had put a hold on the account. All of the checks were signed by Dawn Walker, and most were made out to her or appellant.

At trial, appellant testified that each of the checks represented legitimate payments to him for his work as a subcontractor. He also claimed that the tools in his possession were either broken or belonged to someone else, and that Morgan told him that leftover job materials could be taken home. Appellant further claimed that Morgan had asked him to remove the Dodge truck from the property, but that he never asked appellant for any money.

Dawn Walker testified extensively about the checks and tended to corroborate appellant’s testimony that each of the checks represented payments to him for various jobs. She further claimed that her 2002 raise consisted of a salary of $12.50 per hour and another $12.50 per hour in a so-called “banked” account, which she claimed was accessible to her in the spring of 2002. On rebuttal, Morgan denied that he had authorized Dawn Walker to set up a banked account or that he had doubled her salary; he claimed that her full and entire salary was $12.50 per hour based on a 40-hour work week.

The state argued that appellant could be found guilty of theft for taking funds from the business or for the movable property that was found at his residence. The jury found appellant and Dawn Walker guilty of felony check forgery, with an aggregate amount of more than $2,500, and guilty of theft of property valued at more than $200 but not more than $500, which is a gross misdemeanor.

ISSUE

Is appellant entitled to a new trial because the district court failed to follpw the dual representation procedures set out in Minn. R.Crim. P. 17.03, subd. 5, and because the state failed to demonstrate beyond a reasonable doubt that no prejudicial conflict of interest existed?

ANALYSIS

In Minnesota, an “affirmative-inquiry” approach is required to determine whether jointly represented co-defendants voluntarily consented to the joint representation. Mercer v. State, 290 N.W.2d 623, 625 (Minn.1980); see Minn. R.Crim. P. 17.03, subd. 5 (setting out procedure to be followed before allowing dual representation). In such an inquiry, the district court must elicit narrative responses from each defendant concerning his or her understanding of the conflict of interest. State v. Olsen, 258 N.W.2d 898, 906-07 (Minn.1977). If the court meets this obligation and the defendant nonetheless insists on the joint representation, the defendant bears the burden of demonstrating that an improper prejudicial conflict existed. Id. If, however, the court fails to so advise the defendant, the state must demonstrate beyond a reasonable doubt that no improper prejudicial conflict existed. Id.

Here, the district court failed to conduct the inquiry and relied solely on defense counsel’s own questioning of his clients. In addition, counsel addressed the defendants simultaneously, rather than separately. Finally, rather than questioning the defendants about their understanding of the potential problems with joint representation so as to elicit a narrative response, counsel asked leading questions that required only a yes or no response. We therefore conclude that the colloquy between counsel and defendants failed to comply with the “affirmative-inquiry” mandated by Olsen or by rule 17.03, subd. 5. While this error does not automatically entitle a .defendant to a new trial, the burden shifts to. the state to demonstrate beyond a reasonable doubt that no prejudicial conflict of interest existed. Olsen, 258 N.W.2d at 907-08 (citing Lollar v. United States, 376 F.2d 243 (C.A.D.C.1976)).

An attorney representing two defendants may be faced with possible conflicts of interest in cases involving “inconsistent pleas, factually inconsistent alibis, conflicts in testimony, differences in degree of involvement in the crime, tactical admission of evidence, the calling and cross-examination and impeachment of witnesses, or [differing] strategies] in final summation.” Olsen, 258 N.W.2d at 905 (footnotes omitted). The possibility of “guilt by association” may also present a conflict of interest for an attorney representing two defendants simultaneously. Id.

In Lollar, the court held that “only where we can find no basis in the record for an informed speculation that appellant’s rights were prejudicially affected, can the conviction stand.” Id., 376 F.2d at 247 (quotation omitted). The court determined that the government failed to meet its burden when the “indicators of prejudice” were “troublesome enough to lead to an informed speculation that [the defendant] may have been actually prejudiced.” Id. (quotation omitted).

From the facts presented here, defense counsel could have argued that appellant was an unknowing participant who merely endorsed checks made out to him for his work as a subcontractor. While a unified defense might have been an intended trial tactic, it is just as likely that counsel was precluded from arguing that appellant was an unknowing participant in Dawn Walker’s scheme because of his professional obligation to her. Indeed, the facts here easily could have supported differing defenses or arguments challenging the sufficiency of the evidence against each defendant, because appellant arguably was less involved in the forgery of checks and Dawn Walker was less involved in the theft of movable property.

In a case involving liability by aiding and abetting, the lack of differentiation between the defendants becomes even more pronounced. A person can be criminally liable for aiding and abetting if he or she played a knowing role in the crime; inaction, knowledge, or passive acquiescence, however, does not rise to the level of criminal culpability. State v. Matelski, 622 N.W.2d 826, 831 (Minn.App.2001), review denied (Minn. May 15, 2001). Dual representation of co-defendants charged with aiding and abetting is particularly troublesome, given defense counsel’s inability to vigorously cross-examine co-defendants or to raise doubts about the lack of involvement by one co-defendant at the other’s expense.

Defense counsel’s representation of both appellant and Dawn Walker was further compromised by the manner in which the evidence was presented here and by the prosecutor’s closing arguments. The evidence and the charges against the Walkers were not clearly separated. The prosecutor was able to capitalize on the lack of differentiation between the co-defendants by arguing that the couples’ guilt was a “package deal” because they were married and had an interest in protecting each other. Specifically, the prosecutor argued that Dawn Walker’s testimony was a “convenient explanation to explain away the criminal acts perpetrated by the Walkers” and that the jury had to choose between the Walkers’ word and Morgan’s word. The prosecutor further argued that appellant and Dawn Walker had an interest in protecting themselves and each other because of their marital relationship. Finally, the prosecutor argued that appellant and Dawn Walker were engaged in an “ongoing pattern of deception, an ongoing pattern of betrayal, an ongoing pattern of theft, [and] an ongoing pattern of check forgery.” While the prosecutor’s arguments may have been properly based on the evidence, those arguments further illuminate the problems inherent with one attorney representing two defendants whose testimony may not conflict but whose involvement in a crime differs factually.

The potential for prejudice here was further exacerbated by lack of clear instructions cautioning the jury to separate the evidence and charges against appellant and Dawn Walker. While a district court has discretion to join codefendants for trial, in order to minimize prejudice the court must instruct the jury, both at the time the evidence is offered and again at the close of the case, that the evidence against each co-defendant should be considered separately. See State v. DeVemey, 592 N.W.2d 837, 842 (Minn.1999); State v. Greenleaf, 591 N.W.2d 488, 499 (Minn.1999) (finding no prejudice when court instructed jury at beginning and at end of trial that cases against co-defendants were to be considered separately); see also State v. Kates, 610 N.W.2d 629, 631 n. 4 (Minn.2000) (setting out new cautionary instruction to be given whenever separate offenses are jointed for trial). The district court here, although giving a cautionary instruction, did not give the instruction recommended in Kates. Granted, the jury instructions and the separate verdict forms here tended to force the jury to consider the charges against appellant and his co-defendant wife separately; nevertheless, the manner in which the evidence was presented and the lack of complete instructions both before and after the presentation of that evidence further adds to the possibility of prejudice.

The state asserts that the evidence fails to support appellant’s claim that he was less culpable and that dual representation may have benefited appellant. See Lundin v. State, 430 N.W.2d 675, 678 (Minn.App.1988), review denied (Minn. Dec. 21, 1988). While this may be true, our review of the record here leaves us with an “informed speculation” that appellant may have been actually prejudiced. See Lollar, 376 F.2d at 247. Given this possibility, we conclude that appellant is entitled to a new trial.

DECISION

Because the district court failed to individually question appellant and his co-defendant wife regarding their decision to allow appellant’s attorney to jointly represent them and because the state has failed to show beyond a reasonable doubt that no prejudice resulted from this joint representation, we reverse and remand for a new trial. Given our decision to grant appellant a new trial, we need not address any remaining issues raised by appellant in his brief or pro se supplemental brief.

Reversed and remanded.

      . We note that appellant argues that he cannot be convicted of aiding and abetting felony check forgery because Dawn Walker did not sign a fictitious name and had authority to sign her name to Kodiak's checks. The statutory crime of check forgery was enacted in 1987 and makes it a crime for a person to "falsely make[] ... a check so that it purports to have been made ... by the authority of one who did not give authority.” Minn.Stat. §•609.631, subd. 2 (2002); 1987 Minn. Laws ch. 329, § 13. Under this statute, .a defendant may commit the crime of check forgery if it is established that he has possession of an ■instrument that is valid in all respects, he has explicit instructions as to when or how the instrument is to be used, and he violates that authority. Thus, a person need not sign a fictitious name in order to be guilty of check forgery.


source: Caselaw Access Project

author: STONEBURNER, Judge.

license: Public Domain

text:
    MINNESOTA CENTER FOR ENVIRONMENTAL ADVOCACY, Relator, v. COMMISSIONER OF MINNESOTA POLLUTION CONTROL AGENCY, Respondent, City of Princeton, Respondent.
    No. A04-1324.
    Court of Appeals of Minnesota.
    May 17, 2005.

      Janette K. Brimmer, Minnesota Center for .Environmental Advocacy, St. Paul, MN, for relator.

      Mike Hatch, Attorney General, Paul Merwin, Stephanie Morgan, Assistant Attorneys General, St. Paul, MN, for respondent MPCA.
    The City of Princeton, Princeton, MN, respondent.
    Considered and decided by WILLIS, Presiding Judge; STONEBURNER, Judge; and CRIPPEN, Judge.

       Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const, art. VI, § 10.

   OPINION

STONEBURNER, Judge.

Relator Minnesota Center for Environmental Advocacy (MCEA) challenges respondent Minnesota Pollution Control Agency’s (MPCA) grant of a permit to the City of Princeton- allowing the city to triple the capacity of its current wastewater treatment facility by constructing a waste-water treatment plant (WWTP) that will discharge 1,905,000 gallons of waste per day into an outstanding resource value water, the Rum River. MCEA argues that (1) the finding that there are no prudent and feasible alternatives to the proposed discharge is not supported by substantial evidence in the record because Princeton failed to analyze the alternative of downsizing plus decentralized treatment to reduce the amount of discharge into the Rum River and (2) MPCA’s failure to require available, affordable technology to reduce pollutants in the discharge permitted is contrary to the law requiring protection of the existing, high quality of the water in the Rum River, not supported by substantial evidence in the record, and arbitrary and capricious. MCEA argues in the alternative that it raised factual disputes on these issues requiring a contested-case hearing.

FACTS

Princeton, whose existing wastewater treatment facility is close to capacity and near the end of its useful life span, applied to MPCA for a National Pollutant Discharge Elimination System/State Disposal System permit (NPDES/SDS permit) allowing it to construct a new wastewater treatment plant (WWTP) that will triple the capacity of the current wastewater treatment method and discharge 1,905,000 gallons of wastewater per day directly into the Rum River.

The affected portion of the Rum River has been classified as Outstanding Resource Value Water-Restricted (ORVW-R) since 1984. Minn. R. 7050.0180, subps. 6(D), 6a (G) (2003). An ORVW is a body of water that has “high water quality, wilderness characteristics, unique scientific or ecological significance, exceptional recreational value, or other special qualities which warrant stringent protection from pollution.” Minn. R. 7050.0180, subp. 2(A). It is undisputed that the Rum River’s classification is due to its scenic characteristics, recreational value, and high water quality. MPCA’s nondegradation-of-ORVW policy explains that high water quality and recreational value go hand-in-hand: “the maintenance of existing high quality in some waters of outstanding resource value to the state is essential to their function as exceptional recreational, cultural, aesthetic, or scientific resources.” Minn. R. 7050.0180, subp. 1. The applicable restriction on discharges to ORVWs provides in relevant, part that “[n]o person may cause or allow a new or expanded discharge of any sewage ... [into an ORVW] unless there is not a prudent and feasible alternative to the discharge,” and if a new discharge is permitted, the MPCA “shall restrict the discharge to the extent necessary to preserve the existing high quality, or to preserve the wilderness, scientific, recreational, or other special characteristics that make the water an [ORVW].” Minn. R. 7050.0180, subp. 6.

As part of the permit application, the city was required to perform a nondegra-dation study that included an analysis of various alternatives to determine whether any of the alternatives provided a prudent and feasible alternative to the city’s proposal. One of the alternatives that the city was required to study was “[downsizing the project and/or implementing water conservation practices so that a land disposal method might be used.” The city rejected all of the alternatives it was required to analyze as not prudent or feasible. Downsizing was rejected as inconsistent with Princeton’s planned growth over the next twenty years. Evidence in the record indicates that Princeton’s population could possibly expand from its current 4,200 to 12,500 by 2024.

After reviewing Princeton’s application, including its study of alternatives, plus some additional information requested by MPCA, MPCA staff recommended approval of a permit for Princeton’s proposed WWTP. MPCA staff drafted and circulated for public comment an Environmental Assessment Worksheet (EAW). MCEA voiced concerns about the proposal, asserting that the alternative of downsizing had not been sufficiently analyzed as a feasible and prudent alternative, MPCA’s recommended restrictions on the proposed discharge were only designed to preserve minimal water quality standards, and MPCA failed to require available, affordable technology necessary to protect the higher quality of this river. The Department of Natural Resources also requested that MPCA consider requiring additional, technological upgrades, such as sand filters, to control mercury and CBOD. Neither MCEA nor the DNR requested an Environmental Impact Statement (EIS).

MPCA does not dispute that the use of treatment upgrades such as sand filters and the addition of alum would reduce phosphorus, CBOD, and total suspended solids (TSS) in the discharge, but rejected these upgrades based on its determination that the benefit would be so minimal in comparison to the cost that this alternative is not necessary to protect the quality of the water. MPCA and the city, without considering downsizing in conjunction with decentralized treatment to meet some of Princeton’s projected growth, rejected downsizing on the basis that it would not allow the city to grow at the rate it anticipated.

Concluding that an EIS was not required, MPCA drafted a NPDES/SDS permit for the project that includes a limit on the discharge of phosphorus and a more-stringent-than-minimal limit on TSS, but does not require use of sand filters or alum as proposed by MCEA to further reduce these pollutants as well as CBOD. MPCA circulated the proposed permit for public comment. MCEA requested a contested-case hearing, reiterating its concerns that (1) Princeton failed to adequately consider downsizing in conjunction with decentralized treatment as a feasible and prudent alternative and (2) MPCA failed to require the effluent .restrictions necessary to protect existing high water quality.

In a hearing before the MPCA Citizen’s Board, MPCA staff and MCEA representatives presented the proposed permit and MCEA raised its objections to the permit and requested a contested-case hearing. The board denied MCEA’s request for a contested-case hearing and granted the NPDES/SDS permit with the restrictions proposed by MPCA staff. MCEA appeals the grant of the permit by writ of certiora-ri, arguing that MPCA’s decision to reject downsizing as a feasible and prudent alternative is arbitrary, capricious, and unsupported by substantial' evidence, and MPCA’s failure to require the use of sand filters and alum is contrary to law, unsupported by substantial evidence, and arbitrary and capricious. In the alternative, MCEA argues that MPCA erred by denying a contested-case hearing.

ISSUES

1. Should the city have been required to analyze whether the alternative of downsizing its proposed WWTP and using decentralized treatment methods to accommodate additional anticipated population growth is a prudent and feasible alternative to its proposed discharge of 1,905,000 gallons of wastewater per day into a river classified as ORVW-R?

2. Did MPCA misapply the law when it focused on preservation of the scenic and recreational value of the river rather than on the high water quality of the river to determine necessary restrictions on a permitted discharge?

3. Given MPCA’s mandate to restrict any permitted discharge into an ORVW “to the extent necessary to preserve the existing high quality” of the water, were MPCA’s restrictions in Princeton’s permit arbitrary and capricious and unsupported by substantial evidence in the record because MPCA did not identify or define the existing quality of the water prior to setting the restrictions?

ANALYSIS

I. Standard of review

Our review of MPCA’s decision to grant a permit for Princeton’s proposed WWTP is governed by the Administrative Procedure Act, Minn.Stat. §§ 14.63-.69 (2004); In re Univ. of Minn., 566 N.W.2d 98, 103 (Minn.App.1997). The statute provides in relevant part that this court can affirm, or remand for further proceedings, or reverse, or modify any of the agency’s findings, inferences, conclusions, or decisions if they are affected by error of law, unsupported by substantial evidence in view of the entire record as submitted, or are arbitrary and capricious. MinmStat. § 14.69(d)-(f). The party challenging the decision of the agency has the burden of proof on appeal. Minn. Ctr. For Envtl. Advocacy v. Minn. Pollution Control Agency, 660 N.W.2d 427, 433 (Minn.App.2003). The agency enjoys a presumption of correctness, and “deference should be shown by courts to the agencies’ expertise and their special knowledge in the field of their technical training, education and experience.” Id. (quoting Reserve Mining Co. v. Herbst, 256 N.W.2d 808, 824 (Minn. 1977)).

Deference is also given to the agency’s interpretation of its own rules

when the language subject to construction is so technical in nature that only a specialized agency has the experience and expertise needed to understand it, when the language is ambiguous or when the agency interpretation is one of long standing.

Id. (quoting Resident v. Noot, 305 N.W.2d 311, 312 (Minn.1981)). However, this court will not defer to the agency interpretation “if the language of the regulation is clear and capable of understanding.” Id. (quoting In re St. Otto’s Home v. Minn. Dep’t of Human Servs., 437 N.W.2d 35, 40 (Minn.1989)).

The parties disagree as to the level of deference to be afforded to the agency in this case. MPCA argues that this is a highly technical matter, with “onerous issues,” resulting in great deference given to the agency. See e.g., Resident, 305 N.W.2d at 312 (explaining the general rule that this court should defer to an agency for interpretation of its rules on matters so technical that only the agency has the experience and expertise to understand it). MCEA argues that deference is unnecessary if the agency’s decision is arbitrary, inconsistent, or unreasonable. See generally St. Otto’s Home, 437 N.W.2d at 40-41 (finding agency’s decision unreasonable); In re City of Owatonna’s NPDES/SDS Proposed Permit Reissuance for the Discharge of Treated Water, 672 N.W.2d 921, 926 (Minn.App.2004) (noting that “where there is a combination of danger signals which suggest the agency has not taken a hard look at the salient problems and has not genuinely engaged in reasoned decision making,” this court will intervene).

II. Nondegradation law

The federal Environmental Protection Agency, under authority of the Clean Water Act, 33 U.S.C. §§ 1251-1387, requires each state to develop a nondegradation policy that meets minimum standards. 40 C.F.R. § 131.12(a). At a minimum, the state policy must protect the level of water quality necessary to protect existing water uses, and,

[wjhere.the quality of the waters exceed levels necessary to support propagation of fish, shellfish, and wildlife and recreation in and on the water, that quality shall be maintained and protected unless the State finds ... that allowing lower water quality is necessary to accommodate important economic or social development in the area in which the waters are located. In allowing such degradation ... the State shall assure water quality adequate to protect existing uses fully. Further the State shall assure that there shall be achieved the highest statutory and regulatory requirements for all new and existing' point sources....

Id. at (a)(2). Minnesota’s nondegradation policy applicable in this case is codified in Minn. R. 7050.0180. The rule sets out the policy of MPCA to prohibit or stringently control new or expanded discharges from either point or nonpoint sources to ORVWs. Id. at subp. 1.' Under the rule, “[n]o person may cause'or allow a new or expended discharge of any sewage ... [into and ORVW] unless there is not a prudent and feasible alternative to the discharge.” Id. at subp. 6. And when á discharge is permitted, “the agency shall restrict the discharge to the extent necessary to preserve the existing high quality '... that make[s] the water an [ORVW].” Id.

Minnesota Rules 7001.1000 to 7001.1100 (2003) govern the procedures and conditions for receiving a NPDES/SDS permit, that is required to discharge pollutants from a point source into any water in the state of Minnesota. Minimal standards for municipality point sources are provided in Rule 7050.0211 (2003). Phosphorus effluent discharge is limited to 1 mg/L under this rule when the effluent is discharged to or directly affects a lake or reservoir, but there are no stated phosphorus-effluent limits for rivers.and streams. Minn. R. 7050.0211, subp. la. The rule provides, however, that removal of nutrients, such as phosphorus from wastes “shall be provided to the fullest practicable extent wherever sources of nutrients are considered to be actually or potentially detrimental to preservation or enhancement of the designated water uses.” Id. at subp. la(B).

Plans for a WWTP are governed by Minnesota Rules 7077.0272 and 7077.0274 (2003). Rule 7077.0272, subp. 1, requires that plans for a wastewater treatment system must be prepared and signed by a registered engineer, and subp. 2 requires the plans to include a description of the current WWTP and its problems, a discussion of all treatment alternatives that were considered during the facility selection process, a cost-effective comparison of the alternatives, a comparison of the potential environmental impact of the alternatives, and a description of the selected treatment alternative.

MPCA’s Guidance Manual for Applying Nondegradation Requirements on Outstanding Resource Value Waters in Minnesota (hereinafter Guidance Manual ) describes the procedures, criteria, and time frames associated with meeting the prudent-and-feasible standard. The Guidance Manual notes that although the phrase “prudent and feasible” is “not familiar or highly descriptive to laypersons, it is a well-known and reasonably well-defined term of art in environmental statutes and case law” as requiring an “examination of whether there are unusual or extraordinary' reasons why an alternative to a proposed discharge should not be required.” Minn. Pollution Control Agency, Guidance Manual for Applying Non-degradation Requirements on Outstanding Resource Value Waters in Minnesota, (1988), at 4 (citations omitted). By statute, “[e]conomic considerations alone shall not justify pollution, impairment or destruction of the [sjtate’s natural resources.” Id. (citing Minn.Stat. §§ 116D.04, subd. 6 and 116B.09, subd. 2 (2004)). The permit applicant must analyze the cost and environmental considerations associated with each alternative. Id. at 6. The burden of demonstrating that there is no prudent and feasible alternative is on the permit applicant. Id. at 5. In this case, MCEA challenges only two of the several alternatives considered and rejected as not feasible and prudent.

III. Downsizing alternative

MCEA concedes that, given Princeton’s anticipated growth and the inadequacy of its current wastewater treatment process, development of a WWTP that discharges into the Rum River is somewhat inevitable, but contends that Princeton should have been required to analyze the prudence arid feasibility of downsizing the proposed WWTP to double the current treatment capacity and handling the treatment needs of additional growth though decentralized treatment processes. MCEA asserts that the city did not really analyze this downsizing alternative. MPCA does not argue that because some discharge may be permitted the city is not required to look for prudent and feasible alternatives that would minimize the amount of the discharge.

MCEA asserted that a WWTP with double the city’s current capacity to treat wastewater, in conjunction with decentralized treatment of wastewater to accommodate additional growth, would significantly reduce discharge to the Rum River without limiting the city’s growth and supported this assertion with the affidavit of its expert, Curtis Sparks, P.E., former MPCA consultant and program manager of the permit program (responsible for all NPDES/SDS permits in Minnesota). Sparks opined that downsizing of, the WWTP could occur through the use of decentralized wastewater options that would reduce the new discharge to the Rum River and manage the wastewater from new growth areas without limiting growth. Sparks’s affidavit does not specify the degree of downsizing that would accomplish this result, but the talks between MCEA and MPCA centered on downsizing to double the current capacity, and Sparks’s affidavit was produced to support this proposal.

In its nondegradation analysis, Princeton stated that it is on the “Growing Edge” of the Twin Cities metro area and that failing to build a WWTP with triple the current capacity to treat wastewater would limit the city’s growth potential. The city concluded that it is not prudent and feasible to downsize the project “so that a land disposal method might be used” because the project was designed to handle anticipated future growth and because the city’s per capita wastewater production is already below, average. MPCA accepted the city’s conclusion and did not require the city to examine whether any areas of its. anticipated growth are suitable for decentralized wastewater treatment or make a cost-effective comparison of this alternative as required by the Guidance Manual: .

MPCA argues that MCEA has not shown how much treatment decentralized systems would provide and has not explained how it determined that decentralizing some treatment would only require doubling — rather than tripling — current treatment capacity. MPCA asserts that nonetheless it “examined” the downsizing alternative to determine if it was prudent and feasible. But the purported examination consisted of asserting narrative reasons why the alternative need not be analyzed. There was no attempt at a eosVbenefit analysis or specific information about the environmental impacts of decentralized treatment coupled with a reduced discharge as compared to the proposed discharge. MPCA continues to argue that it has no control over the size of the city’s WWTP and. asserts. that centralized treatment is favored over other treatment systems under the Clean Water Act, citing Columbus & Franklin County Metro. Park. Dist. v. Shank, 65 Ohio St.3d 86, 600 N.E.2d 1042, 1058 (1992). The Shank court noted that “centralized treatment has many economic, environmental and public policy attributes ... [and][t]he policy favoring centralization pervades the Clean Water Act.” 600 N.E.2d at 1058. But Shank does not provide the most recent commentary on decentralized systems. In September of 2000, MPCA stated in a report to the legislature, titled Waste-ntater Treatment and Collection Systems (Report), that “[t]he lack of centralized wastewater facilities is not necessarily a problem in itself. Under the right conditions, [individual sewage treatment systems] or small community systems (e.g., cluster systems) can provide excellent, cost-effective wastewater treatment.” Furthermore, MPCA noted a 1997 EPA report to Congress concerning decentralized wastewater systems:

EPA concluded in its report, “adequately managed decentralized wastewater systems are a cost effective and long-term option for meeting public health and water quality goals.” Reasons cited for installing decentralized systems included:
• Properly managed decentralized systems can provide the treatment necessary to protect public health and the environment. They can be sited, sized, designed, installed and operated to meet all federal, state, and local water-quality requirements.
•Are appropriate for low-density communities.
• Decentralized systems are usually the most appropriate technology and most cost-effective options for rural areas and many urban outskirts.
. - Are- appropriate for varying site conditions.
Decentralized systems can be designed for a variety of site and soil conditions including shallow water tables, bedrock and small lot sizes.

Report at 13. The MPCA Report concludes that: “[c]ommunities upgrading failing systems should consider both centralized and decentralized systems.” Id. at 20. MPCA argues in this case that á decentralized treatment option is too speculative because it would “require a review of decentralized treatment options for each development before authorization to connect to the system ...” and because it is unknown if the land would be appropriate for such systems. We find this argument has no merit.

In this case, the mayor of Princeton told the board that the city council has already platted all of the land for the current WWTP and there are many requests for more developments. The city administrator explained that the public utilities commission has been adding and extending water lines to certain areas. As a consequence, there is a finite amount of land to be considered in an analysis of the feasibility of decentralized wastewater treatment for a finite number of people (approximately 4,000 people who would not be serviced by a double-capacity plant). And the interest in particular areas by particular developers provides a logical starting point for an investigation by the city into this alternative. There is no evidence that the city seriously considered whether downsizing coupled with decentralized treatment systems could adequately address its anticipated wastewater treatment needs. And no authority has been cited to this court that would excuse the city from examining the feasibility of this alternative to limit the proposed new discharge into an ORVW-R.

Princeton’s city administrator simply dismissed the idea of decentralized systems, stating: “[o]ur experience is that on-site systems, as good as they are, are only as good as the people who maintain them,” therefore if “expansion of a [WWTP] is curtailed, I believe that the impact on the Princeton area is going to be negative.” But MCEA responded that “decentralized” does not necessarily mean individual mound septic systems, noting that cluster treatment facilities are permitted by MPCA and are highly regulated.

The MPCA Issue Statement submitted to the board most directly responds to the decentralized alternative by explaining that the city developed a plan to meet its population requirements, and that MCEA did not lay out specific enough treatment amounts for the decentralized alternative. But. the burden of showing that downsizing was not feasible and prudent is on the city, not MCEA. MCEA has raised the issue that the alternative was never actually analyzed and it cited the Elk River community as an example where decentralized treatment for some development has allowed the city to limit the size of its WWTP. MPCA staff rejected Elk River’s experience as not applicable because the manner in which Elk River arrived at this solution differs from Princeton’s approach to future wastewater treatment. But the method by which Elk River arrived at its system does not prevent the use of decentralized treatment from being an alternative subject to consideration as prudent and feasible for Princeton. Princeton has the burden to demonstrate that there are no feasible and prudent alternatives to its proposed discharge of 1,905,000 gallons of wastewater per day into an ORVW-R before MPCA can permit such discharge.

This court can reverse or remand an agency’s decision if it is unsupported by substantial evidence in the record. Minn. Stat. § 14.69. “Substantial evidence” means:

1. Such relevant evidence as a reasonable mind might accept as adequate to support a conclusion;
2. More than a scintilla of evidence;
3. More than some evidence;
4. More than any evidence; and
5. Evidence considered in its entirety.

White v. Minn. Dept. of Natural Res., 567 N.W.2d 724, 730 (Minn.App.1997), review denied (Minn. Oct. 31, 1997). And “[t]he court will intervene ... where there is a combination of danger signals which suggest the agency has not taken a ‘hard look’ at the salient problems’ and the decision lacks ‘articulated standards and reflective findings.’ ” Id. (quoting Cable Communications Bd. v. Nor-West Cable Communications P’ship, 356 N.W.2d 658, 668-69 (Minn.1984) and Herbst, 256 N.W.2d at 825 (Minn.1977)).

In this case, we conclude that there is not substantial evidence in the record to support rejection of the alternative of downsizing the WWTP and using decentralized treatment as not feasible or prudent, and we remand this issue to the MPCA with instructions to require the city to actually analyze the prudence and feasibility of this alternative.

IY. Restrictions on discharge

a. MPCA’s restrictions were not imposed to preserve existing water quality as required by law

Minnesota’s nondegradation policy requires MPCA to restrict any permitted discharge to an ORVW “to the extent necessary to preserve the existing high quality, or to preserve the wilderness, scientific, recreational, or other special characteristics that make the water an [ORVW].” Minn. R. 7050.0180, subp. 6. On appeal, MPCA does not dispute that the Rum River’s designation as an ORVW-R is due in part to the high quality of the water. But when MPCA staff presented the proposed permit for Princeton’s WWTP to the board, Deborah Schumann, a staff permit writer in MPCA’s water quality program, told the board that MPCA staff imposed restrictions “to the extent necessary to preserve the Rum River’s scenic and recreational characteristics.”

Schumann erroneously asserted that this reach of the Rum River was not designated an outstanding resource value water because of high water quality, but rather its designation by the DNR is a state scenic and recreational river. So those are the characteristics that' we have to protect, that’s what we have the authority to do. To set stringent standards to protect the receiving stream’s scenic and recreational value.

Schumann also told the board that MPCA’s authority to impose restrictions on wastewater discharges into the ORVW-R river is limited, stating: “[T]he extent of what [MPCA] can do” with regard to restrictions is impose the technology-based controls already established by the CWA for publicly owned treatment works. Schumann told the board that the only reason MPCA was able to include some restrictions that exceed established standards was by negotiation with the city. Despite the comments of MCEA’s representative that MPCA’s responsibility is to restrict the discharge to the extent necessary to preserve the existing high water quality of the Rum River, and at least one board member’s comment indicating that understanding, the board voted five to two to deny a contested hearing and to approve the permit as drafted by. MPCA staff.

MPCA’s findings of fact include the following:

The MPCA finds that the effluent limits •in the proposed permit meet the minimum secondary treatment standards, will ensure .protection of the receiving water for its designated uses, will not cause or contribute to an exceedance of water quality standards, and will not impair those special characteristics that make the Rum River an [ORVW].
The proposed limits reflect more stringent effluent limitations for TSS, DO, and P in order to protect the high recreational and fishery value of the Rum River.

(Emphasis added.) MPCA’s conclusions of law include:

The proposed permit contains effluent limitations and special conditions which are the most stringent allowed by current rule and policy. These limits and conditions. will meet or exceed the minimum secondary treatment standards, will ensure protection of the receiving water for its designated uses, will not cause or contribute to an excee-dance of water quality standards, and will not decrease the river’s existing special scenic or recreational value.

(Emphasis added.) The record, findings, and conclusions demonstrate that, despite sporadic references to water quality, MPCA’s focus in granting the permit was on the scenic and recreational qualities of the Rum River and that the restrictions on the discharge were set only to prevent degradation below ordinary water quality standards rather than to protect the existing high quality of the water. MPCA ignored the clear mandate of the CWA and nondegradation rules to restrict any discharge into an ORVW “to the extent necessary to preserve the existing high quality.” MPCA’s authority clearly extends to protect the existing high quality of the ORVW, and their own policies require an exercise of that authority to maintain the high water quality of a valuable water resource. Failure to impose restrictions designed to maintain the Rum River’s high water quality constitutes an error of law. We reverse the order granting the permit and remand for reconsideration of restrictions necessary to protect the existing high quality of the water in the Rum River.

b. MPCA’s failure to define the existing high quality of the water in the Rum River makes the rejection of affordable, available technology as unnecessary to preserve that quality arbitrary and capricious.

MCEA argues that MPCA’s restrictions on pollutants in the permitted discharge do not satisfy MPCA’s obligation under EPA rules to “assure that there shall be achieved the highest statutory and regulatory requirements for all new and existing point sources.... ” 40 C.F.R. § 131.12. MCEA asserts that MPCA rejected requiring effective, available, affordable technology such as sand filters and the use of alum based only on cost and an erroneous application of only minimal water quality standards plus “negotiated” higher limits for some pollutants.

Rule 7050.0211 sets out the “minimum secondary treatment for municipal point source and other point source dischargers of sewage.” Minnesota Rule 7050.0220 (2003) lists “specific standards of quality and purity by associated use classes.” But MCEA argues that these mínimums are not sufficient to maintain the existing high quality of the water in this case as is required under the Minnesota rules and the CWA for discharge to an ORVW-R. The pertinent limits set forth in rule 7050.0211, as compared to MPCA’s proposed limits for Princeton’s WWTP are as follows:

_Effluent_ Rule_Princeton WWTP

CBOD6_25 mg/L (Minn. R. 7050.0211, subp.l)_15 mg/L_

Fecal Coliform Organisms 200 organisms per 100 milliliters (Minn. R. 200 organisms per 100 _7050.0211, subp.l)_ milliliters''_

Total Suspended Solids_30 mg/L (Minn. R. 7050.0211, subp.l)_20 mg/L_

Phosphorus No requirement for rivers; 1.0 mg/L for lake 1.0 mg/L or reservoir (Minn. R. 7050.0211, subp.l), _suggested limit in Phosphorus Strategy_

Mercury 6.9 ng/L (R. 7050.0220, subp.3a, B(16)-numeric 17 ng/L (daily maximum) quality standard) 10 ng/L (monthly _average)_

Dissolved Oxygen (non- 5.0 mg/L (minimum) (Minn. R. 7050.0222, 6.0 mgR (minimum) pollutant) subp.4)

MPCA argues that it correctly evaluated the costs and benefits of requiring sand filters and alum and concluded that the de minimus reduction in pollution that would result from their use made them unnecessary to preserve existing high water quality. But there is no evidence in the record defining or describing the quality of the water that is to be protected. Without defining what the existing quality of the water is, it is not possible to evaluate whether Princeton’s proposed discharge has been restricted to the extent necessary to preserve that quality, making any cost/benefit analysis meaningless. The city clearly values the high quality of the Rum River. Princeton’s city administrator told the board that if the proposed additional technology were necessary to preserve the high quality of the water: “I don’t think you’d get any argument from the city of Princeton about [adding the technology].”

MPCA argues that the term “existing high water quality,” which is not defined or quantified in statute or rule, is ambiguous, requiring MPCA to “apply its expertise in determining exactly what is meant by ‘existing high water quality’” and that the court must defer to this exercise of expertise. Nowhere in the record, however, does MPCA define the existing high quality of the Rum River, so there is nothing to defer to in this case. And we do not find merit in MPCA’s argument that the term “existing high quality” is so technical in nature that only a specialized agency has the experience and expertise needed to understand it. To the contrary, the phrase is clear and capable of being understood. No deference is given to an agency’s interpretation of its own regulation if the language of the regulation is clear and capable of understanding, and the court may substitute its own judgment. In re St. Otto’s Home, 437 N.W.2d at 40.

This is the first application for a permit to discharge pollutants into the Rum River. We hold that the “existing high quality” of water in a river into which no discharge has been previously permitted is the quality of the water prior to the issuance of any permit to discharge. Given that definition we defer to MPCA’s expertise to determine and define, in terms existing pollutants in the river or other standard methods for defining water quality, the baseline quality of the water in the Rum River as it exists prior to permitting any discharge. Once that is accomplished, permitted discharges need to be restricted to the extent necessary to preserve that quality. Any cost/benefit analysis must consider whether additional affordable technology would assist in preserving the baseline quality. Absent a baseline, merely setting limits that achieve a quality at or slightly above the minimum required for all waters, as MPCA has done in this case, is an arbitrary and capricious method of determining what limits are necessary to protect existing water quality of this valuable water resource.

V. Contested-case hearing

Because we have granted the relief sought by MCEA, we do not reach the alternative request for a contested-case hearing on the issues raised in this appeal. But we caution that if disputed issues remain following remand, MPCA should conduct a contested-case hearing to provide a fully developed record on which the board can make informed decisions.

DECISION

Under Minnesota’s nondegradation rules, the City of Princeton must analyze the prudence and feasibility of a downsized WWTP used in conjunction with acceptable decentralized treatment to meet additional anticipated population growth before such an alternative can be rejected by the city and MPCA as not prudent or feasible. The MPCA must establish the existing water quality of the Rum River and impose necessary requirements and restrictions on Princeton’s proposed WWTP to protect that quality.

Reversed and remanded.

      . Princeton’s current wastewater method does not discharge to any surface waters.

      . CBOD refers to the oxygen demand made by certain pollutants in the water body over a five-day period. If the oxygen demand is too high, dissolved oxygen (DO) in the water may become too low to support certain aquatic life. CBOD is regulated as a pollutant under portions of Minnesota Rule 7050.

      . A "point source” is '"any discernible, confined and discrete conveyance, including, but not limited to, any pipe, ditch, channel, tunnel, conduit, well, discrete fissure, container, rolling stock, concentrated animal feeding operation, or vessel or other floating craft, from which pollutants are or may be discharged.” Minn.Stat. § 115.01, subd. 11 (2004). A "nonpoint source” is "a land management or land use activity that contributes or may contribute to ground and surface water pollution as a result of runoff, seepage, or percolation and that is not defined as a point source.” Minn. R. 7050.0130(C) (2003).

      . MPCA set the phosphorus limit in this case at 1 mg/L, and the internal MPCA office memorandum regarding Princeton’s WWTP, and comments by MPCA staff at the Citizen’s Board meeting, indicate that suggested phosphorus effluent limits for an ORVW, according to the MPCA Phosphorus Strategy, require a phosphorus limit of 1 mg/L or less.

      . The parties agree that downsizing to reduce the amount of a proposed discharge could be analyzed under the part of the rule that requires restrictions on a proposed discharge necessary to preserve water quality rather than under the prudent and feasible alternatives requirement of the rule, but that the prudence and feasibility of this alternative would have to be considered in either analysis.

      . MPCA acknowledged' at oral -argument that it has authority in other areas to make decisions that will impact community growth but ■.asserts without explanation that control of community growth cannot be achieved through the NDPES permitting process.

      . See 1999 Minn. Laws ch. 231, § 198. Also available at: http://www.pca.state.mn.us/hoVlegislature/re-ports/2001/wwtreatment.pdf (last visited May 11, 2005).

      . On January, 12, 2005, the EPA published a press release, regarding its continued vision for decentralized wastewater treatment systems. See Environmental Protection Agency, Decentralized. Wastewater Treatment Systems: A Program Strategy, (Jan. 12, 2005) available at http://www.epa.gov/owm/septic/pubs/sep-lic_program_strategy.pdf (Last visited May 11, 2005). The EPA notes that decentralized systems are a "key component” of the nation’s water treatment infrastructure, and citing the 1997 report, it showed concern for areas that still needed improvement for these systems to be better recognized as the "key component” of the system. See id. at 1, 4. See also, Environmental Protection Agency, Response to Congress on Use of Decentralized Wastewater Treatment Systems, (1997), mirco-formed on EPA/832/R-97/001B (U.S. Dep't of Commerce, Nat. Technical Info. Serv.), available at http://cfpub.epa.gov/owm/septic/publi-cations.cfm?sort=date_ published & view=all (Last visited May 11, 2005).

      . An assistant attorney general who was present during the staffs presentation to the board stated that he thought Schumann meant to say that water quality standards also mattered.


author: HUDSON, Judge. ROBERT H. SCHUMACHER,

text:
    Jeanne Marie ALEXIS, individually and as the mother and natural guardian of Jameson Alexis, Guetchina Alexis, Joshua Alexis, Joelwonson Alexis, Joemian Alexis, and Guetdina Alexis, minors, Appellant, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Respondent.
    No. A04-1562.
    Court of Appeals of Minnesota.
    May 17, 2005.

      Sharon L. Van Dyck, Candace L. Dale, Schwebel, Goetz & Sieben, P.A., Minneapolis, MN, for appellant.
    William M. Hart, Melissa Dosick Rieth-of, Meagher & Geer, P.L.L.P., Minneapolis, MN, for respondent.
    Considered and decided by HUDSON, Presiding Judge; SCHUMACHER, Judge; and HALBROOKS, Judge.
   OPINION

HUDSON, Judge.

Decedent Joseph Alexis and his wife’s cousin, Henriquez Saintias, were found dead in decedent’s Chevrolet Suburban, which was parked in the garage attached to decedent’s house. It was later determined that both men died of carbon monoxide poisoning caused by exhaust from the Suburban. Other members of decedent’s family, who were in the house at the time, were treated for carbon monoxide poisoning. Decedent’s survivors sought benefits under their no-fault automobile insurance policy. After a bench trial on stipulated facts, the district court ruled that the death and injuries did not arise out of the maintenance or use of a motor vehicle within the meaning of the No-Fault Automobile Insurance Act; therefore, decedent’s survivors were not entitled to benefits. We affirm.

FACTS

At approximately 8:00 a.m. on September 29, 2001, appellant Jeanne Marie Alexis called 911 to report that her 8-year-old daughter was having trouble breathing. Wfiien the fire department and paramedics arrived, they asked appellant if she had a way to get to the hospital and if there was someone who could watch the other children in the house. Appellant responded that her husband was sleeping in the garage. When firefighters entered the garage, they found decedent and appellant’s cousin, Saintias, unconscious in the family’s 1993 Chevrolet Suburban. Both men later died. The subsequent police investigation concluded that they died of carbon monoxide poisoning caused by exhaust from the Suburban.

On February 26, 2003, appellant filed suit against respondent State Farm Mutual Automobile Insurance Company, seeking economic-loss benefits and funeral expenses under the decedent’s no-fault automobile insurance policy. Respondent asserted that the injuries to the decedent and his family did not arise out of the maintenance or use of a motor vehicle and, thus, coverage was denied. On May 26, 2004, the parties waived their right to a jury trial on the issue of coverage and stipulated that the first two prongs of the three-factor test set forth in Continental Western Insurance Co. v. Klug, 415 N.W.2d 876 (Minn.1987) had been met. The third prong of the Klug test — whether the vehicle was being used for transportation purposes at the time of the injury — was disputed. The parties, however, agreed to submit stipulated facts on which the district court was to rely in determining whether the third-prong of the King test was satisfied.

Specifically, the parties stipulated to the following relevant facts:

• Decedent’s family owned three cars: (1) a 1993 Chevrolet Suburban, (2) a 1998 Dodge Caravan, and (3) a 1989 Honda Accord. All three vehicles were insured by respondent.
• Decedent was employed by Carlson Floor Care and worked the night shift from 11:00 p.m. to 7:30 a.m.
• According to decedent’s supervisor, decedent “was always at work and always on time.”
• Appellant stated that “[o]n occasion when [decedent] returned home from working the night shift, he would rest in the car for a short time to avoid the morning noise of the children,” but he “had never slept overnight in the garage.”
• Saintias returned from work at approximately 3:00 p.m. on September 28, and he worked within walking distance of the family home.
• On September 28, 2001, after returning from work, decedent went fishing from approximately 8:30 a.m. until 8:30 p.m. Decedent drove the Honda Accord on his fishing trip.
• After the decedent returned home from fishing around 8:30 p.m., he and Saintias went into the garage.
• Appellant last saw decedent around 9:00 p.m. in the garage when she asked him if he wanted any food — he did not. Appellant last saw Saintias in the living room.
• Appellant put the children to bed around 9:30 p.m. and then fell asleep.
• The decedent did not show up for work by 11:00 p.m. on September 28, 2001.
• At approximately 8:00 a.m. on September 29, 2001, appellant called 911 to report that her 8-year-old daughter was having trouble breathing.
• When the fire department and paramedics arrived, they asked appellant if she had a way to get to the hospital and if there was someone who could watch the other children in the house. Appellant responded that her husband was sleeping in the garage.
• Firefighters found the decedent “lying down on the floor of the rear passenger area” of the Suburban, and found
' Saintias “lying down in. the rear area of the truck.”
• The garage door was closed, the doors of the Suburban were locked, and the key was in the ignition in the “on” position, but the engine was not running and the gas tank was full.
• The decedent and Saintias died from carbon monoxide poisoning. Toxicology reports indicate that neither man had ingested alcohol or controlled substances.
• Precision Tune performed an emissions test on the Suburban and determined that the Suburban generated higher-than-n'ormal levels of carbon monoxide in the first 20 minutes of operation.
• Excel Energy found no problems with the gas lines or appliances in the home.
• The police investigation concluded that the Suburban was the source of the carbon monoxide poisoning, the deaths were accidental, and there was no evidence to support an attempted suicide on the part of either man.

Based on these facts, the district court found that the decedent’s death “was caused by carbon monoxide, which came from the Suburban,” and that “[t]here is a direct causal connection between the Suburban and his death.” The court found that the “causal link between the Suburban and [decedent’s] death is unbroken by any other fact or event.” But, in conclusion, the district court held that the “Suburban was not being used for transportation purposes” at the time of the injuries; therefore, the injuries “did not arise out of the maintenance or use of a motor vehicle within the meaning of the Minnesota No-Fault Act,” and appellant was not eligible to receive no-fault benefits. This appeal follows.

ISSUE

Was decedent’s death caused by an accident arising out of the use of his automobile for transportation purposes?

ANALYSIS

Under Minnesota’s No-Fault Automobile Insurance Act, Minn.Stat. §§ 65B.41— 65B.71 (2004) (no-fault act), an insured may recover basic economic-loss benefits for injuries “arising out of the maintenance or use of a motor vehicle.” Minn.Stat. § 65B.44, subd. 1(a) (2004). A predominant goal of the no-fault act “is to allocate the costs of injuries causally resulting from motoring activities to the automobile insurance system.” Benike v. Dairyland Ins. Co., 520 N.W.2d 465, 466 (Minn.App.1994), review granted (Minn. Oct. 14, 1994), and appeal dismissed (Minn. Apr. 5, 1995). Under the no-fault act, the phrase “ ‘[mjaintenance or use of a motor vehicle’ means maintenance or use of a motor vehicle as a vehicle, including, incident to its maintenance or use as a vehicle, occupying, entering into, and alighting from it.” Minn.Stat. § 65B.43, subd. 3 (2004) (emphasis added).

1. Standard of review

As previously stated, the parties stipulated that the first two prongs of the test in Cont’l Western Ins. Co. v. Klug, 415 N.W.2d 876 (Minn.1987) were satisfied. Therefore, the only issue before the district court was whether, under the third prong of the Klug test, decedent’s Suburban was being used for “transportation purposes” at the time of the accident. We must first resolve the parties’ dispute regarding the appropriate standard of review on appeal. Appellant argues that because the district court’s ultimate determination that the automobile was not being used for transportation purposes is a matter of statutory interpretation under the no-fault act, the appropriate standard of review is de novo. Respondent argues that the district court’s finding that the “Suburban was not being used for transportation purposes” is a factual finding and, thus, it should be reviewed under a deferential, clearly-erroneous standard. Whether “an injury arises out of the use or maintenance of a motor vehicle is a question of law.” Kemmerer v. State Farm Ins. Cos., 513 N.W.2d 838, 842 (Minn.App.1994), review denied (Minn. June 2, 1994); see also Klug, 415 N.W.2d at 877-78 (stating that the determination of whether an accident arose out of the maintenance or use of a motor vehicle is a legal issue that turns on the particular facts presented in each case). And it is well settled that appellate courts need not defer to the district court’s conclusions when reviewing questions of law. Frost-Benco Elec. Ass’n. v. Minn. Pub. Utils. Comm’n, 358 N.W.2d 639, 642 (Minn.1984). Accordingly, we find that de novo review of the district court’s decision is appropriate here.

2. Burden of proof

A second threshold issue here is which party must bear the burden of proof on the “transportation purposes” question. The supreme court shed light on this question in McIntosh v. State Farm Mut. Auto. Ins. Co., 488 N.W.2d 476, 480 (Minn.1992), when it stated, “[t]o be eligible for no-fault benefits [the insured] must also, of course, meet the use requirement established in Klug by proving that her injury resulted from an accident arising out of the use of a motor vehicle.” Although this statement could be characterized as dicta, this court has held — in reliance on the language of McIntosh — that “the party claiming no-fault benefits bears the burden of proving by a preponderance of the evidence that there was an accident and that the accident arose out of the operation, use or maintenance of a motor vehicle.” LaValley v. Nat’l Family Ins. Corp., 517 N.W.2d 602, 604 (Minn.App.1994), review denied (Minn. Aug. 24, 1994). Accordingly, we find that the burden of proving, by a preponderance of the evidence, that the injuries arose out of the use of a motor vehicle for transportation purposes lies with appellant as the insured party.

3. Was decedent using the automobile for transportation purposes?

In Klug, the supreme court formulated a three-factor test to assist in determining whether an injury arose out of the maintenance or use of a motor vehicle under the no-fault act. First, courts must consider the extent of the causation between the vehicle and the injury. Klug, 415 N.W.2d at 878. Second, if causation is present, courts consider whether an act of independent significance broke the causal chain. Id. And third, if no intervening act breaks the causal chain, courts must determine whether the vehicle was being used for transportation purposes at the time of the injury. Id. Here, we must determine whether, under the third prong of the Klug test, decedent’s injuries arose out of the use of a motor vehicle for “transportation purposes.” ■ It is well settled that the purpose of the “use” inquiry is to limit the liability of no-fault insurers to risks associated with motoring. See Classified Ins. Corp. v. Vodinelich, 368 N.W.2d 921, 923 (Minn.1985); cf. Klug, 415 N.W.2d at 878 (“Though there may be a causal link between use of the car and the injury, the court must determine what type of ‘use’ of the automobile was involved.”).

Minnesota precedent instructs that a claimant does not satisfy her burden of proof by merely demonstrating that the injured party’s use was reasonably consistent with the inherent nature of a vehicle. Vodinelich, 368 N.W.2d at 923. In Vodinelich, a woman committed suicide by idling her car engine while parked in the family’s attached garage. Id. at 922. In doing so, she accidentally caused the deaths of her two children in the house. Id. The supreme court concluded that the children’s deaths did not arise out of the use of a motor vehicle for transportation purposes, reasoning that it is not sufficient to show that the vehicle’s engine was on. Id. at 923. Rather, a claimant must show that the injured party’s use was consistent with “motoring.” Id.

Here, applying the reasoning in Vodine-lich, appellant has not demonstrated by a preponderance of the evidence that the decedent’s use of the vehicle was consistent with motoring. Decedent and Sainti-as were found lying down in the back area of the truck, rather than in the front seat where one would expect a person to be if they were planning on driving. Moreover, even though decedent did not have to be at work until 11:00 p.m., he went into the garage around 8:30 p.m., and appellant saw decedent in the garage at 9:00 p.m. These facts suggest that travel was not imminent. In addition, Saintias’ presence in the truck between 9:00 p.m. and the time of the accident, when combined with the fact that Saintias did not have to work until the next morning, further indicates that the decedent was not preparing to leave for work when he turned on the car. Finally, although the key was in the ignition and in the “on” position, no facts suggest, and appellant does not claim, that decedent had returned from a recent trip. Taken together, these facts suggest that decedent turned on the ignition to warm the car and/or listen to the radio while he rested in the back seat. The facts do not suggest that the decedent was using the car for transportation purposes at the time of his death and, therefore, his survivors are not eligible to receive no-fault benefits.

But appellant relies on Norwest Bank Minn., N.A. v. State Farm Mut. Auto. Ins. Co., 588 N.W.2d 743 (Minn.1999), to support her contention that decedent was using the car for transportation purposes at the time of the accident. Appellant’s reliance is misplaced. In Norwest Bank, homeowners accidentally left their car running in an attached garage after a night out dining and later died during the night from carbon monoxide poisoning. 588 N.W.2d at 745. The supreme court held that the accident that caused the homeowners’ injuries occurred while the vehicle was being used for transportation purposes. Id. at 747. The supreme court reasoned that the homeowners started and drove their vehicle for transportation purposes — to travel from the restaurant to their home — and “neither our cases nor the No-Fault Act support. a conclusion that use of a motor vehicle for transportation purposes must be contemporaneous with the ultimate injury suffered by the insured.” Id. at 746-47. “[T]he critical question is not whether the [homeowners’] injuries occurred while [their automobile] was being used for transportation purposes, but rather whether, on these facts, the [homeowners’] injuries arose out o/the use of [their automobile] for transportation purposes.” Id. at 747.

Accordingly, although the supreme court in Norwest Bank held that the use of a motor vehicle for transportation purposes need not be contemporaneous with the ultimate injury, it did not excuse insureds from also establishing that the injury resulted from the use of the automobile as an automobile, i.e., for a transportation purpose. On the particular facts of this case, appellant did not meet her burden.

While no one will ever know with any certainty what the decedent and Saintias were doing at the time of their deaths or why they decided to turn on the automobile in a closed garage, we hold that on these particular facts and under the current state of Minnesota law, decedent was not using the automobile for transportation purposes. We recognize that this decision compounds the tragedy that has befallen the Alexis family; we nonetheless feel constrained to affirm the district court’s decision.

DECISION

Because decedent was not using the vehicle for “transportation purposes” at the time of the accident, his death did not arise out of the use of a motor vehicle within the meaning of the No-Fault Automobile Insurance Act. Accordingly, we affirm.

Affirmed.

ROBERT H. SCHUMACHER,

Judge (concurring specially).

I concur with the majority’s decision. The facts of this case lead to the inference that, at the time of the accident, the decedent was not using his automobile for “transportation purposes” as that phrase has come to be defined by Minnesota courts. But I feel compelled to point out the incongruence of this decision with the primary purpose of Minnesota’s No-Fault Automobile Insurance Act. The supreme court aptly defined the purpose of no-fault insurance as follows:

Insurance for economic loss benefits is purchased to protect the insured against risk of injury arising from the maintenance or use of a motor vehicle regardless of whether the tortfeasor was negligent or acted intentionally, or even if there were no tortfeasor. It is enough if the victim accidentally injures herself. In other words, the focus is not on the tortfeasor; rather, no-fault benefit eligibility is dependent exclusively on the injured victim and whether she has been hurt under circumstances arising from the use of a motor vehicle. This is true first party coverage.

McIntosh v. State Farm Mut. Auto. Ins. Co., 488 N.W.2d 476, 480 (Minn.1992).

Here, it is undisputed that the decedent died as a result of an accident caused directly by his use of a motor vehicle. And the decedent had no-fault insurance. No-fault insurance exists to cover just such a case. Where it is undisputed that an accident has occurred as a result of the operation of a motor vehicle, it should follow that an insured with no-fault insurance should be compensated for the damage caused by the accident. Thus, I fear that the “transportation purposes” test now operates to exclude a class of accidents and victims that the Minnesota Legislature never intended to exclude when it passed the no-fault act.

      . Thus, neither party disputes that there was a direct causation between the automobile and the injury, and that no act of independent significance occurred breaking the causal link between the "use” of the vehicle and the injuries inflicted. See Klug, 415 N.W.2d at 878.

      . Appellant also relies on the supreme court’s decision in Tlougan v. Auto-Owners Ins. Co., 310 N.W.2d 116 (Minn.1981). But the insurer in Tlougan did not dispute that a transportation purpose was pending at the time of the accident. Id. at 117.