Statutes, codes and customs

Statutes, codes and customs are important in a legal context, as lawyers and judges spend a lot of time in liability cases looking at these three categories of rules to apply to the conduct of the parties before the court.

John McCoy

In some cases, all three may apply, in others, none of them may apply.

Statutes are laws adopted by a legislative body and enacted into law, at both the state and federal level. Often, state and federal laws overlap, sometimes federal law preempts state law and, on rare occasions, state law could trump federal law.

A common example of a statute that affects the propane industry is the “container law” that generally says tanks can only be filled with the owner’s consent, a protective measure to keep gas systems safe and to protect the owner’s investment in his inventory and business.

The most common codes in the propane industry are NFPA 58 and 54. However, these are consensus standards created by private organizations that standing alone do not have the force of law. For these codes – and any codes created by a private group – to have the force of law the state or local authority having jurisdiction must adopt them. This is usually done at the state level.

There are various means used in the states to adopt codes. In some states, the legislature exists in the administrative rules of the state. Other states create an LP gas board vested with the authority to adopt and/or create standards for the industry in that state. In these and other examples, states and the boards they create are free to adopt all or part of the codes that a private association has created.

When states adopt codes they sometimes adopt a specific edition, like the 1992 edition of NFPA 58. Until they adopt a later version, the 1992 edition is the law of the state, even if the National Fire Protection Association creates new editions of that code. Since each edition of the code changes, it’s important to know which code your state follows at all times.

Propane industry codes have grandfather provisions that make it clear that, for the most part, the new provisions of the codes are not retroactive to existing systems. There are very practical reasons for this clause.

It would be impossible to go out and update every gas installation every time a new code came out. The time and cost needed to accomplish this task would be prohibitive and would make the provision of gas service extremely expensive, with the cost having to be passed on to the consumer.

There also is a recognition that systems that have been in place and operating safely are serving the goal of the consensus code.

When new technologies are brought on board they need time to filter through the system to the end user. New technologies are primarily used on a going-forward basis in any industry. In rare cases, change can be more dramatic. A recent example is the change to OPDs on 20-lb. cylinders that occurred over a few years.

Most gas companies get the most recent edition of both NFPA 54 and 58 when they become effective. There is usually training about the changes that occur in these codes after they are promulgated. This can occur in many forms, from articles in trade publications, to other written and published materials, and in training seminars.

Many companies also develop their own customs and practices and, from time to time, the industry may adopt a custom or practice. This custom or practice, if it is well defined and exists industry wide or is consistently employed within a company, is something that may also create a standard with legal implications. However, voluntary programs or programs that are not followed in a company or nationally may work against legal implications.

If your lawyer isn’t always clear as to what your legal obligations are, it doesn’t mean he’s being evasive; the answer is complex.

John McCoy is the president of McCoy & Hofbauer, S.C. and specializes in the representation of propane companies. He can be reached at 262-522-7007 or jmccoy@mh-law.us.