Secretary, VT Agency of Natural Resources v. Irish

Secretary, Agency of Natural Resources v. Irish (97-509); 169 Vt. 407; 
738 A.2d 571

[Opinion Filed 25-Jun-1999]
[Motion for Reargument Denied 21-Jul-1999]

       NOTICE:  This opinion is subject to motions for reargument under
  V.R.A.P. 40 as well as formal  revision before publication in the Vermont
  Reports.  Readers are requested to notify the Reporter  of Decisions,
  Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
  any  errors in order that corrections may be made before this opinion goes
  to press.


                                 No. 97-509


Secretary, Vermont Agency of	                      Supreme Court
Natural Resources and
City of South Burlington	                      On Appeal from
     		                                      Environmental Court
     v.
                                                      January Term, 1999
Frank Irish


Merideth Wright, J.


       Gary S. Kessler, Senior Environmental Enforcement Attorney, Waterbury,
  for Plaintiff-Appellee Agency of Natural Resources.

       Joseph S. McLean of Stitzel, Page & Fletcher, P.C., Burlington, for
  Plaintiff-Appellee City  of South Burlington.

       Michael B. Clapp, Burlington, for Defendant-Appellant.


PRESENT:  Amestoy, C.J., Dooley, Morse, Johnson and Skoglund, JJ.


       SKOGLUND, J.  Defendant Frank Irish appeals from an Environmental
  Court decision  that certain excavation work on his property was in
  violation of the Vermont Wetland Rules, the  City of South Burlington
  zoning bylaws, and 10 V.S.A. § 1259 (discharge of waste into State  waters
  without a permit).  Defendant contends: (1) the Wetland Rules failed to
  provide adequate  notice that the work was occurring in a significant
  wetland; (2) the area in question had not been  validly designated as a
  significant wetland; (3) the work was for farming purposes and therefore 
  did not violate the Wetland Rules; (4) the evidence did not support a
  finding that he violated 10 

 

  V.S.A. § 1259; (5) the zoning-violation finding was erroneous; and (6) the
  monetary penalties  were improper.  We affirm in part, reverse in part, and
  remand for further proceedings.

                                    FACTS


       Defendant is a farmer whose property is located in South Burlington. 
  The subject of this  dispute concerns a 26-acre parcel of the farm lying
  south of Allen Road.  The northerly and  easterly halves of the parcel
  consist of hayfields.  Approximately in the middle of the parcel is a 
  wetland demarcated on the National Wetland Inventory (NWI) maps for the
  State of Vermont.

       In February 1996, the Irish Development Corporation submitted an
  application to the City  for a 48-lot subdivision for the property.  The
  application listed defendant as the owner of the  property, and Peter
  Smejkal and Ron Brousseau as contacts for the applicant corporation.  On 
  March 19, 1996, Catherine O'Brien, assistant wetlands coordinator for the
  Agency of Natural  Resources (Agency), visited the site in response to a
  request by the City.  She informed Smejkal  that the site contained
  significant wetlands, including areas contiguous to wetlands identified on 
  the NWI maps, informed him that a conditional use determination (CUD) by
  the Secretary of the  Agency would be required before any development could
  take place on the property, and  recommended that he hire a wetlands
  consultant to further define the wetland areas.  The  consultant was
  estimated to cost $1500.

       Later that month, defendant hired a contractor to excavate a drainage
  ditch along the  southern and western boundaries of the parcel to intercept
  water draining onto the land from an  existing water supply line.  The
  excavator proceeded to cut and remove trees and brush from the  area, grub
  up tree roots and stumps, excavate the ditch, and deposit some of the brush
  and roots  into the ditch.  In early April, O'Brien visited the site again
  in response to a complaint that work  was occurring in a protected wetland. 
  In addition to the excavation work, O'Brien 

 

  observed substantial erosion in the ditch that was causing a continual
  discharge of silt into the  nearby Bartlett Brook.  

       The City sent defendant a notice of violation on April 17, followed by
  a second notice of  violation on April 30, alleging violations of the
  City's zoning bylaws.  In early May, the Agency  sent a notice of
  violation, stating that the excavation work was within a significant
  wetland area  and required a CUD under the Vermont Wetland Rules.   One
  year later, in May 1997, the  Secretary of the Agency issued an
  Administrative Order finding that defendant had violated § 6.3  of the
  Wetland Rules by stumping, grading and ditching in a significant wetland
  without first  obtaining a CUD, and had further violated 10 V.S.A. § 1259
  by causing a discharge into state  waters.  The same month, the City filed
  a complaint in Chittenden Superior Court alleging  violations of the City's
  zoning bylaws.  Defendant filed a request for hearing on the Agency's 
  Administrative Order with the environmental court, pursuant to 10 V.S.A. §
  8012(a).  By  stipulation of the parties, the City's complaint was
  consolidated with the proceeding on the  Administrative Order.  

       Following an evidentiary hearing, the court issued a written decision,
  finding that  defendant had committed the charged violations, and imposed
  "alternative penalties."  The court  imposed a base penalty of $2,500 for
  the State violations, and $2,195 for the City violations.  In  the event
  that on or before May 6, 2001, the property was sold, subdivided, or
  developed by  defendant for other than agricultural purposes, the court
  ordered that defendant would be required  to pay an additional penalty of
  $15,000 to the State, and an additional penalty of $19,755 to the  City. 
  This appeal followed.

 


                                 DISCUSSION
  Notice

       Defendant first contends the Vermont Wetland Rules failed to provide
  sufficient notice that  the portion of his property where the excavation
  work was performed was a significant wetland,  thereby requiring a CUD
  before the work could be commenced.  The Wetland Rules require a  CUD by
  the Secretary for certain uses within "significant" wetlands.  See Vermont
  Wetland  Rules, § 6.3.(FN1)  The Wetland Rules provide further that all
  wetlands shown on the NWI maps  for the State of Vermont, and all wetlands
  contiguous to such mapped wetlands, are presumed to  be Class Two wetlands,
  which in turn are defined as significant.  See id. §§ 4.1, 4.2.(FN2)  In 
  addition, the Wetland Rules set forth standards and methods for identifying
  the boundary between  wetland and upland areas, and distinguishing wetlands
  from deepwater habitat.  See id. § 3.2.

       It is undisputed that the NWI maps for Vermont showed a wetland on
  defendant's  property.  Although the specific area where the excavation
  work was performed lay outside the  delineated wetland, the Agency alleged,
  and the court found, that it was within a contiguous  wetland area. 
  Defendant asserts that the Rule designating continuous wetlands as
  significant  

 

  failed to give reasonable notice of the precise area subject to the CUD
  requirement.

       Due process of law requires notice sufficient to "give the person of
  ordinary intelligence  a reasonable opportunity to know what is prohibited"
  and to "provide explicit standards for those  who apply them."  Grayned v.
  City of Rockford, 408 U.S. 104, 108 (1972); see also State v.  Galusha, 164
  Vt. 91, 94, 665 A.2d 595, 597 (1995).  The degree of precision that will
  satisfy this  standard, however, "varies with the nature -- and in
  particular, with the consequences of  enforcement -- of the statutory
  provision."  General Media Communications, Inc. v. Cohen, 131 F.3d 273,
  286 (2d Cir. 1997).  As the United States Supreme Court has explained:

     [E]conomic regulation is subject to a less strict vagueness test 
     because its subject matter is often more narrow, and because 
     businesses, which face economic demands to plan behavior 
     carefully, can be expected to consult relevant legislation in advance 
     of action.  Indeed, the regulated enterprise may have the ability to 
     clarify the meaning of the regulation by its own inquiry, or by 
     resort to an administrative process. The Court has also expressed 
     greater tolerance for enactments with civil rather than criminal 
     penalties because the consequences of imprecision are qualitatively 
     less severe.

  Village of Hoffman Estates v. Flipside, 455 U.S. 489, 498-99 (1982)
  (footnotes omitted); see also  In re 1650 Cases of Seized Liquor, ___ Vt.
  ___, ___, 721 A.2d 100, 107 (1998); Rogers v.  Watson, 156 Vt. 483, 491,
  594 A.2d 409, 413-14 (1991). 

       Assessed in light of this standard, the Wetland Rules were sufficient
  to put defendant on  reasonable notice of the existence of significant
  wetland areas and the possibility that the planned  excavation might
  require environmental review and approval.  Indeed, the record discloses
  that  defendant did not have to inquire about the possibility.  Catherine
  O'Brien, the assistant wetlands  coordinator for the State of Vermont, was
  contacted by the City after it received the subdivision  application for
  defendant's property, and she in turn contacted the applicant and visited 

 

  defendant's property in mid-March 1996, prior to commencement of the
  excavation.  O'Brien  identified several areas of significant wetland on
  the property, including areas contiguous to those  identified on the NWI
  maps, explained that any work within these areas would require a prior 
  CUD, and recommended that a wetland consultant be hired to further
  delineate the extent of the  wetland area.  O'Brien wrote a follow-up
  letter on March 27 in which she confirmed the presence  of significant
  wetlands on and adjacent to the property, recommended the hiring of a
  wetlands  consultant, and reaffirmed the need for a CUD before commencing
  work in the area.

       Defendant did not hire a wetland consultant or apply for a CUD. 
  Instead, in late March,  defendant hired an excavation contractor, who
  began work in one of the contiguous wetland areas,  cutting and removing
  trees and brush, excavating an irrigation ditch, and depositing some of the 
  removed brush and stumps in the ditch.  During a second site visit in late
  April, O'Brien  discovered that substantial damage had been done to the
  wetland area by the excavation.  A notice  of violation issued shortly
  thereafter.  

       Thus, although the Wetland Rules themselves did not define the precise
  boundaries of the  contiguous wetland areas on defendant's property, the
  Agency clearly put defendant on notice of  the existence of those areas,
  offered its administrative expertise and advice to clarify the precise 
  boundaries of the wetland areas, and delineated standards and methods for
  identifying those areas.  See Village of Hoffman Estates, 455 U.S.  at
  498-99 (regulatory statute may be less precise where  regulated enterprise
  has ability to clarify meaning on its own, or through administrative
  process).  Accordingly, we are satisfied that the Wetland Rules provided
  ample notice to a person of  ordinary intelligence of the need to obtain a
  CUD for the work in question.  The imposition of  civil penalties in these
  circumstances did not violate due process.  

 

  Designation of Wetlands

       Defendant next contends that Wetland Rule 6.3, requiring a CUD for
  certain conditional  uses within a significant wetland, was unenforceable
  because the Water Resources Board failed  to conduct the statutorily
  mandated evaluation necessary to designate as "significant" the specific 
  wetlands on defendant's property.

       Defendant relies on 10 V.S.A. § 905(7), which provides that the Board
  shall: "Adopt rules  for the identification of wetlands which are so
  significant that they merit protection.  Any  determination that a
  particular wetland is significant will result from an evaluation of at
  least the  following functions which the wetland serves."  The statute then
  sets forth eleven separate criteria,  including such functions as water
  storage, spawning of fresh water fish, stopovers for migratory  birds, and
  habitation for endangered species.  Id. § 905(7)(A), (D), (F), and (H). 	
  Because  the Board did not evaluate the specific wetland area located on
  defendant's property pursuant to  the criteria set forth in § 905(7),
  defendant argues that it lacked authority to designate the wetland  as
  significant.

       The argument is unpersuasive.  As noted, the Vermont Wetland Rules
  provide that all  wetlands identified on the NWI maps for the State of
  Vermont, and all wetlands contiguous  thereto, are presumed to be Class Two
  wetlands, which in turn are presumed to serve the  functions that qualify a
  wetland as significant.  See Wetland Rules, §§ 4.1, 4.2.  These rules were 
  the product of a 1988 Agency study of the Vermont wetlands identified on
  the NWI maps.  Based  on a random sample, the study found that over 93% of
  the evaluated NWI wetlands were  significant based upon one or more of the
  eleven criteria set forth in 10 V.S.A. § 905(7).

       In light of the over 22,000 acres of NWI wetlands in Vermont, the
  Board's decision to  designate all of the NWI wetlands as significant,
  based upon the high percentage of the sample 

 

  meeting the statutory criteria, was reasonable.  The statute does not
  explicitly require a separate  and detailed evaluation of every wetland
  designated as significant, and we cannot say that the  Board's reliance on
  the Agency study constituted clear error.  See State v. Rolfe, 166 Vt. 1,
  8,  686 A.2d 949, 955 (1996) (the Court "defer[s] to an agency's
  interpretation of enabling legislation  unless there is a compelling
  indication of error").  Furthermore, the Wetlands Rules afforded 
  defendant, or any other affected landowner, the opportunity to petition the
  Board to reclassify the  wetland, and areas contiguous thereto, to a higher
  or lower classification.  See Wetland Rules,  § 7.  Accordingly, the
  Board's classification of the NWI wetlands was not clearly erroneous.

  Agricultural Use

       Defendant next contends he was not subject to the CUD requirement
  because the  excavation work was for an agricultural purpose.  The argument
  implicates two provisions of the  Wetland Rules.  Section 3 exempts from
  the definition of a wetland those areas used for "farming  activities,"
  which are generally limited to the "grow[ing] of food or crops .  .  .  in
  ordinary  rotation."  Wetland Rules, § 3.1(c); see also 10 V.S.A. § 902(5)
  ("wetlands" shall exclude "such  areas as grow food or crops in connection
  with farming activities").  The Rules provide further  that "[t]he
  exemption will expire whenever the area is no longer used to grow food or
  crops or  in ordinary rotation."  Wetland Rules, § 3.1(c).  The court here
  found, and the evidence amply  demonstrated, that the area where the work
  was performed was not being used to grow food or  crops in ordinary
  rotation, and had not been farmed for many years.  Therefore, it did not
  qualify  for the exemption.

       In addition to the farming exemption, the Wetland Rules also provide
  that farming  constitutes an "allowed use" within a significant wetland
  area.  See Wetland Rules, § 6.2.  

 

  "[P]rovided that the configuration of the wetland's outlet or the flow of
  water into or out of the  wetland is not altered and that no draining,
  dredging, filling, or grading occurs," a landowner may  engage in "[t]he
  growing of food or crops in connection with farming activities" without
  prior  review by the Secretary.  Id. § 6.2(f).  Thus, it is undisputed that
  while the farming exemption  requires a current and ongoing use of the land
  for growing crops, an "allowed use" may include  the preparation of land
  for future farming purposes. 

       Defendant contends that the excavation work was performed for the
  purpose of preparing  the area for pasture and crop production, and
  therefore constituted an allowed use that required  no prior approval. 
  Defendant testified that this was his purpose, and the excavation
  contractor  provided some corroboration, recalling that defendant had said
  something about wanting to grow  soybeans.  The State asserts, on the
  contrary, that the work was not to prepare the land for  farming, but
  rather to prepare the area for development in accordance with the
  subdivision  proposal, a conditional use that required prior approval from
  the Secretary.  The State relies on  a map of the proposed subdivision
  showing the excavation area divided into housing lots.  The  court's
  finding on this issue was decidedly ambiguous.  It stated:

     From the evidence we cannot find that the disturbed area constituted land 
     which grows food or crops in connection with farming activities.  10 
     V.S.A. § 902(5) and Vermont Wetland Rules § 6.2(f).  Unlike the 
     neighboring fields, the disturbed area showed no traces of having been 
     used as cropland, pasture, or other farmland in accepted agricultural 
     practices.

       Although the court's finding clearly concerns the farming "exemption,"
  the citations relate  to farming as an "allowed use."  Despite the
  confusion, it is clear that the court made no factual  finding concerning
  defendant's purpose in undertaking the work, other than noting that
  defendant  "believed that drainage or development work in a wetland would
  be exempt if it was 

 

  for agricultural purposes."  Absent a finding on this issue, we are unable
  to determine whether  the excavation work was a conditional or an allowed
  use, and therefore cannot adequately review  the court's findings that
  defendant was required to obtain a CUD, and violated § 6.3 of the  Wetland
  Rules by failing to do so.  Accordingly, this portion of the judgment must
  be reversed,  and the case remanded to the trial court for further findings
  and, if necessary, additional evidence  on these issues.
 
  Discharge Without a Permit

       Defendant next contends the evidence failed to support the court's
  finding of a violation  of 10 V.S.A. § 1259 (discharge into waters of state
  without a permit).  Defendant asserts that he  did not intend a discharge
  into Bartlett Brook, and that the discharge resulted from the Agency's 
  stop-work order which prevented him from completing the ditch.  

       The claims are unpersuasive.  Although the law requires that any
  person who intends to  discharge waste into state waters must obtain a
  permit, see 10 V.S.A. § 1263, there is no  requirement that the State prove
  intent to establish a violation of § 1259, which simply provides  that, "No
  person shall discharge any waste, substance, or material into waters of the
  state  .  .  .  without first obtaining a permit."  Furthermore, the record
  showed that Catherine O'Brien, the  assistant wetlands coordinator for the
  Agency, visited the site in April, one month before the stop-work order,
  and observed significant erosion of silt and sediments from the ditch into
  Bartlett  Brook.  Accordingly, the court's finding of a violation of § 1259
  was not clearly erroneous.  See  Agency of Natural Resources v. Bean, 164
  Vt. 438, 443, 672 A.2d 469, 472 (1995) (findings of  trial court are not
  clearly erroneous and will stand if there is any credible evidence to
  support  them).

 

  Zoning Violations

       Defendant raises several claims concerning the zoning violations.  The
  City's zoning  bylaws permit certain uses, including farming, within the
  Conservation and Open Space District  where defendant's land is located,
  subject to certain specific limitations.  The use may not damage  the
  quantity or quality of surface or ground water, and any excavation of earth
  materials or cutting  or removal of trees is limited to the extent
  necessitated by the permitted use.  See South  Burlington Zoning Regs., §
  3.40.  

       The court here found that the same activities that violated § 6.3 of
  the Wetland Rules and  10 V.S.A. § 1259, also violated the above-referenced
  zoning provisions.  Defendant argues that  the finding was unclear as to
  the nature of the violations,  and was unsupported by the evidence.  There
  was no lack of clarity in the court's finding, however, which plainly
  referred to the  clearing of trees, brush, and stumps, the depositing of
  debris in the irrigation ditch, and the  discharge of sediment into
  Bartlett Creek.  Furthermore, even assuming, as defendant contends,  that
  the work was done for agricultural purposes, the evidence amply supported a
  finding that  erosion from the irrigation ditch had impaired the quality of
  surface water, and that the excavation  and removal of trees and brush
  exceeded what was necessary for the supposed use, in violation  of the
  zoning bylaws.  Although defendant argues that the Accepted Agricultural
  Practice  regulations adopted by the Commissioner of the Department of
  Agriculture, Food, and Markets  specifically authorize the ditching and
  subsurface draining of farm fields, they also explicitly  prohibit the
  discharge of waste into the surface waters of the State, in accordance with
  State law.  See Accepted Agricultural Practice Regs., §§ 3.2(e), 4.01(a). 
  Thus, the court's finding was  supported by the evidence, and must be
  upheld.  See Bean, 164 Vt. at 443, 672 A.2d  at 472  (court's findings will
  stand if supported by any credible evidence). 

 

       Finally, defendant contends the City's complaint failed to adequately
  specify the zoning  violations subsequently found by the trial court.  All
  of the issues relating to the violations found  by the court were actively
  tried by the parties.  Accordingly, they were properly addressed by by  the
  trial court.  See V.R.C.P. 15 (b) (when issues not raised by pleadings are
  tried by express or  implied consent of parties, they shall be treated in
  all respects as if they had been raised in  pleadings).(FN3)

  Penalties

       Finally, defendant contends that the monetary penalties were
  erroneously imposed in three  respects.  First, he contends that the base
  fines payable to the State ($2,500) and to the City  ($2,195) for failure
  to take remedial action were improper because the State's notice of
  violation  of May 6, 1996, ordered defendant to stop work on the site.  The
  notice in question, however,  ordered defendant to cease the excavation
  work that was causing erosion and damage within a  protected wetland.  It
  did not prohibit defendant from taking corrective action; indeed, it urged 
  defendant to take remedial measures, stating, "[y]our efforts to achieve
  compliance may lessen  the severity of the final result of any enforcement
  action."  The notice further directed defendant  to call or write the
  Agency concerning his efforts to "correct this alleged violation." 
  Accordingly,  defendant's claim is without merit.

       Defendant also argues that the imposition of a penalty based upon the
  avoided cost of  hiring a wetland consultant, estimated at $1,500, was
  improper because defendant was not a  partner in the corporation proposing
  the development.  Defendant owned the property, knew of  the plans to build
  the development, instigated the excavation work, and was on notice of the 

 

  alleged violations and the Administrative Order requiring, among other
  remediation measures, that  he hire a wetlands consultant.  Under these
  circumstances, the penalty was proper.

       Lastly, defendant contends the imposition of conditional penalties was
  improper.  In  addition to the base penalties, the court ruled that if,
  prior to May 6, 2001, the property is "sold  or otherwise transferred for
  any reason, or is subdivided or developed by [defendant] for other  than
  agricultural or open space purposes," defendant would be required to pay an
  additional  penalty of $15,000 to the State, and an additional penalty of
  $19,755 to the City, on account of  the violations.  The conditional
  penalties were designed, the court explained, "to account for  whether the
  ditching and drainage activities are in fact linked to future sale,
  transfer or  development of the property." (FN4)  	

       The imposition of civil penalties represents a discretionary ruling
  that will not be reversed  if there is any reasonable basis for the ruling. 
  See Town of Hinseburg v. Dunkling, 167 Vt. 514,  528, 711 A.2d 1163, 1171
  (1998).  Here, the court's conclusion that a higher penalty would be 
  warranted if the excavation was undertaken to enable the development and
  sale of the property,  was reasonable.  In that event, the enhanced penalty
  would properly reflect the potential economic  gain from the violation, see
  10 V.S.A. § 8010(b)(5), and would fall well within the remedial  scope and
  limits of the zoning-penalty statute.  See 24 V.S.A. § 4444; Dunkling, 167
  Vt. at 528-29, 711 A.2d  at 1171.

       The court's broad discretion, however, did not include the authority
  to simply decline 

 

  to rule on whether the excavation was done for development purposes.  The
  trial court has a  fundamental duty to make all findings necessary to
  support its conclusions, resolve the issues  before it, and provide an
  adequate basis for appellate review.  See V.R.C.P. 52(a); Roy v.  Mugford,
  161 Vt. 501, 507, 642 A.2d 688, 692 (1994).  This includes the duty to make
  all  findings necessary for the assessment of an appropriate penalty. 
  Although understandable given  the conflicting evidence, the court's
  decision to defer making findings on the purpose of the  excavation work
  violated this fundamental duty.  Defendant is entitled to a definitive
  ruling on this  factual issue, which is critical not only to the court's
  conclusion that defendant violated Wetland  Rules, § 6.3 (as previously
  discussed), but also to the penalty ultimately to be imposed.  
  Accordingly, the imposition of alternative penalties must be reversed, and
  the matter remanded  for further findings and, if necessary, additional
  evidence on these issues.

       Those portions of the judgments finding a violation of Vermont Wetland
  Rules, § 6.3, and  imposing alternative penalties, are reversed, and the
  case is remanded for further proceedings on  these issues.  In all other
  respects, the judgments are affirmed.



                                        FOR THE COURT:




                                        _______________________________________
                                        Associate Justice



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                                  Footnotes


FN1.  Section 6.3 in pertinent part provides: "All uses which are not
  allowed uses are conditional  uses.  Conditional uses may be allowed,
  within significant wetlands or their associated buffer  zones, only under
  the terms of an order issued by the Secretary."

FN2.  Section 4.1(b) defines Class Two wetlands as those "found to be so
  significant, either taken  alone or in conjunction with other wetlands,
  that they merit protection under these Rules. 
      Section 4.2(b) provides that"[a]ll wetlands shown on the National 
  Wetlands Inventory  maps for the State of Vermont (1978) published by the 
  U.S. Fish and Wildlife Service, and all  wetlands contiguous to such mapped 
  wetlands, are presumed to be Class Two wetlands, unless  determined otherwise
  by the Board as provided for in Section 7 of these rules." 
       
FN3.  The parties also dispute whether defendant properly appealed the
  City's two violation  notices.  In view of our holding that the evidence
  supported the finding, we need not address  this issue.
  
FN4.  The City had requested a fine of $50 per day for the 439 days of
  violation between the  effective date of the notice of violation, and the
  date of trial.  The base penalty of $2,195  represented a penalty of $5 per
  day for the violations.  The conditional penalty of $19,755  represented an
  additional $45 penalty per day.  The State had proposed a total penalty of 
  $17,500.  The court imposed a base penalty of $2500.  The conditional
  penalty of $15,000  represented the balance of the penalty requested by the
  State.