Denio, In re

• Decision Date: 03 April 1992
• Docket Number: No. 89-214,89-214
• Citation: 158 Vt. 230,608 A.2d 1166
• Court: Vermont Supreme Court
• Parties: In re Chester P. and Bertha G. DENIO.

Page 1166

608 A.2d 1166

158 Vt. 230

In re Chester P. and Bertha G. DENIO.

No. 89-214.

Supreme Court of Vermont.

April 3, 1992.

John D. Hansen, Rutland, for appellants.

Jeffrey L. Amestoy, Atty. Gen., Ron Shems, Asst. Atty. Gen., and David K. Mears, Law Clerk (On the Brief), Montpelier, for amicus curiae State.

Before ALLEN, C.J., and GIBSON, DOOLEY, MORSE and JOHNSON, JJ.

DOOLEY, Justice.

Appellants Chester and Bertha Denio appeal a decision of the Vermont Environmental Board granting an Act 250 permit for a three-lot subdivision adjacent to an already existing 71-lot subdivision, but imposing twenty conditions. The Denios contest the Board's exercise of jurisdiction and claim that the Board (1) misallocated the burden of proof on the issue of aesthetics; (2) made findings of fact and conclusions of law which were not based exclusively on the evidence before it and were erroneous; and (3) set unreasonable conditions for the new lots. We affirm.

In 1972, appellants purchased approximately 263 acres in Shaftsbury and received an Act 250 permit for a 71-lot subdivision on 200 acres. In 1987 they applied to the District Environmental Commission for a permit to subdivide an additional seven acres of their land into three lots. The Commission considered their application as an amendment to the 1972 subdivision permit, and denied it, although it detailed conditions it would impose if it were to issue a permit. Appellants then went to the Board for a de novo review of the Commission's decision, pursuant to 10 V.S.A. § 6089. After a hearing and visit to the site, the Board issued its findings of fact, conclusions of law, and an order permitting the proposed subdivision, subject to twenty conditions, on March 27, 1989. Some of the conditions imposed by the Board required that the subdivision conform to certain plans stated in the permit application, and to statements made in the Board's findings and conclusions. In part, the conditions were based on the Board's finding, under 10 V.S.A. § 6086(a)(8), that, in the absence of adherence to the conditions, the subdivision would adversely affect the aesthetics of the surrounding area.

At no point in the proceedings before the Commission and Board did any party receiving notice of the requested permit and proceedings, under 10 V.S.A. § 6085, raise objection or present evidence in opposition to the permit's issuance. And at no point in the proceedings did appellants raise an objection to the exercise of Act 250 jurisdiction over the matter by the Commission and Board.

I.

Appellants' first claim is that the Board lacked jurisdiction over the subdivision proposal. Although this issue was not raised before either the Commission or the Board, appellants argue that subject-matter jurisdiction can be raised at any time, including for the first time in this Court. See Boisvert v. Boisvert, 143 Vt. 445, 447, 466 A.2d 1184, 1185 (1983). We disagree that preservation is not required.

Our general requirement that issues be raised in the forum from which an appeal is taken, before they are raised here, is statutorily required in Act 250 proceedings. 10 V.S.A. § 6089(c) provides:

(c) No objection that has not been urged before the board may be considered by the supreme court, unless the failure or neglect to urge such objection shall be excused because of extraordinary circumstances.

We have applied the statute to jurisdictional issues, although, in the case involved, In re State Aid Highway No. 1, 133 Vt. 4, 8, 328 A.2d 667, 669 (1974), we found "extraordinary circumstances" to allow review without preservation. More recently, we stated that "issues not raised below, even those having a constitutional dimension, need not be considered when presented for the first time on appeal." In re Burlington Housing Auth., 143 Vt. 80, 81-82, 463 A.2d 215, 217 (1983). We conclude that § 6089(c) applies and prevents appellants from raising the jurisdictional issue for the first time on appeal. There are no "extraordinary circumstances" that would excuse the lack of preservation.

We are guided in our interpretation of the preservation statute by the law of exhaustion of administrative remedies. Requiring preservation of jurisdictional issues in an administrative forum, usually under the rubric of exhaustion of administrative remedies, is common in American law and must be viewed as an exception to the general rule that subject-matter jurisdiction can be raised at any time. Based on his analysis of United States Supreme Court opinions, Professor Davis has indicated that three factors are considered in determining whether exhaustion of administrative remedies is required with respect to a jurisdictional issue. See 3 K. Davis, Administrative Law § 20.03, at 69 (1958 ed.). Those are (1) the extent of injury from pursuit of an administrative remedy; (2) degree of apparent clarity or doubt about administrative jurisdiction; and (3) involvement of specialized administrative understanding in the question of jurisdiction. Id.; see also SEC v. G.C. George Securities, Inc., 637 F.2d 685, 688 n. 4 (9th Cir.1981) (application of Davis factors).

If we were to analyze this case under the Davis factors, it is clear that exhaustion would be required. Appellants suffer no injury from pursuit of the administrative remedy; they have already obtained a ruling from the Board. In numerous cases, we have recognized the specialized expertise of the Board in determining whether it has jurisdiction over a particular development proposal. See In re H.A. Manosh Corp., 147 Vt. 367, 370, 518 A.2d 18, 20 (1986) (the Court will "defer to the Board's expertise"). At best, the jurisdictional issue is close.

Analysis of the facts of the present case under the Davis factors also demonstrates that there are no extraordinary circumstances here to excuse nonpreservation of the jurisdictional issue under § 6089(c). Appellants even characterized their own proposal as an amendment to their preexisting permit, leading the Board away from a critical examination of its jurisdiction. If ever we will require preservation in the Board, this is the case to do it.

Our analysis of this particular case shows the strong policy reasons why we must apply the preservation statute to jurisdictional disputes. Moreover, the language of § 6089(c) is broad and contains no exception for jurisdictional issues. This omission is significant because for an administrative board of limited jurisdiction virtually any disagreement with its actions can be phrased in jurisdictional terms. Indeed, the vast majority of Act 250 appeals involve jurisdictional issues, and in resolving them, we have accorded "a high level of deference" to the interpretation of Act 250 by the Board. In re Vitale, 151 Vt. 580, 582, 563 A.2d 613, 615 (1989). If we adopt appellants' position, applicants will be able to avoid raising jurisdictional challenges before the Board, and seek a ruling for the first time in this Court if they are dissatisfied with the Board's action on the merits. As a result, the most important decisions on the scope of Act 250 will be made without involvement of the Board or its expertise. See McKart v. United States, 395 U.S. 185, 195, 89 S.Ct. 1657, 1663, 23 L.Ed.2d 194 (1969) ("frequent and deliberate flouting of administrative processes could weaken the effectiveness of an agency by encouraging people to ignore its procedures"). We must construe the preservation statute consistent with its plain meaning as well as " 'the subject matter, its effects and consequences, and the reason and spirit of the law.' " Nash v. Warren Zoning Board of Adjustment, 153 Vt. 108, 112, 569 A.2d 447, 450 (1989) (quoting In re R.S. Audley, Inc., 151 Vt. 513, 517, 562 A.2d 1046, 1049 (1989)). When we do, we must require preservation of all issues even if they go to the subject-matter jurisdiction of the Board. The exception for extraordinary circumstances provides a sufficient safety valve to protect against excusable failures, especially if they involve clear questions of law on which Board expertise is less important.

Because appellants had a duty to raise the issue of jurisdiction before the Board, and failed to do so, they are foreclosed by § 6089(c) from raising it here, and we need not address its merits.

II.

Next, we turn to appellants' claims of substantive error by the Board. A number of these claims center around the Board's findings of fact and conclusions of law with respect to the aesthetic impact of the proposed subdivision. We note that we must affirm findings of the Board if based on "substantial evidence," 10 V.S.A. § 6089(c), which is evidence properly before the Board that is relevant and which a reasonable person might accept as adequate to support a conclusion. In re McShinsky, 153 Vt. 586, 589, 572 A.2d 916, 919 (1990).

Appellants first argue that the Board improperly allocated the burden of proof in finding that the subdivision would have an adverse effect on the aesthetics of the area without adherence to the permit conditions. The Board or Commission granting a permit is required to find that a subdivision "[w]ill not have an undue adverse effect on the scenic or natural beauty of the area, aesthetics ... and irreplaceable natural areas." 10 V.S.A. § 6086(a)(8). Although the applicant has the burden of proof on many Act 250 issues, the burden of proof with respect to aesthetics is "on any party opposing the applicant ... to show an unreasonable or adverse effect." Id. § 6088(b).

In this case, no opponent of the permit appeared or presented evidence before the Board. The Board's finding that adherence to its conditions would be necessary to prevent an adverse aesthetic effect was based, rather, on testimony by Chester Denio and on information gained through its visit to the site. Appellants claim that the Board was precluded from finding against them on an issue for which they did not bear the burden of proof, particularly as no party...