In re Treetop Dev. Co. Act 250 Dev.

• Decision Date: 12 February 2016
• Docket Number: No. 15–168.,15–168.
• Citation: 2016 VT 20,143 A.3d 1086
• Parties: In re TREETOP DEVELOPMENT COMPANY ACT 250 DEVELOPMENT (Treetop at Stratton Condominium Association, Inc., Appellant).
• Court: Vermont Supreme Court

143 A.3d 1086

2016 VT 20

In re TREETOP DEVELOPMENT COMPANY ACT 250 DEVELOPMENT (Treetop at Stratton Condominium Association, Inc., Appellant).

No. 15–168.

Supreme Court of Vermont.

Feb. 12, 2016.

Motion for Reargument Denied March 25, 2016.

A. Jay Kenlan of Kenlan, Schwiebert, Facey & Goss, P.C., Rutland, for Appellant.

Lisa B. Shelkrot of Langrock Sperry & Wool, LLP, Burlington, for Appellees.

William H. Sorrell, Attorney General, and Gavin J. Boyles and Scot L. Kline, Assistant Attorneys General, Montpelier, for Natural Resources Board.

Present: DOOLEY, SKOGLUND and EATON, JJ., and TOMASI and BRYAN (Ret.), Supr. JJ., Specially Assigned.

EATON

, J.

¶ 1. This appeal is the latest chapter in an ongoing dispute between the Treetop at Stratton Condominium Association, Inc. (Association) and the Stratton Corporation, Treetop Development Company, LLC, Treetop Three Development Company, LLC, and Intrawest Stratton Development Corporation (collectively, Stratton) over an improperly constructed stormwater management system. The pending matter follows the Association's appeal of the District 2 Environmental Commission's (Commission) refusal to impose additional conditions on Stratton's Act 250 permit, which the Environmental Division of the Superior Court determined to be invalid and unenforceable. For the reasons stated herein, we affirm.

¶ 2. On November 18, 2002, the District 2 Environmental Commission issued Act 250 Permit # 2W1142 to Stratton for the construction of twenty-five three-unit townhouses (the Treetop Project) in the Town of Stratton, Vermont. Included in the Act 250 permit was approval for the development and construction of the infrastructure required for the occupancy, use, and management of the Treetop Project and associated infrastructure, including a stormwater management system.

¶ 3. A Stratton Corporation affiliate, the Treetop Development Company, LLC, completed construction of the Treetop Project in 2006, at which point all seventy-five townhouses were sold and conveyed to third-party owners. Each individual owner acquired an undivided percentage interest in the Treetop Project's common areas and facilities, including the stormwater management systems, which were managed and administered by the Association.

¶ 4. In response to problems with the stormwater management system, the Association filed suit against Stratton in 2009 seeking damages and remediation for various construction defects in the Treetop Project, including those involving the stormwater management system. The parties ultimately reached a settlement agreement, which, relevant to this appeal, required Stratton to apply for and obtain corrective permit amendments and pay for any work necessary to bring the stormwater management aspects of the Treetop Project into compliance with its Act 250 permit. On August 13, 2012, Stratton filed an application with the Commission to amend its Act 250 permit to reflect deviations from the original permit, specifically “to authorize changes in the original as-built plans to the permit plans submitted.” These changes included repairs and modifications to the stormwater management system necessary to fix leaks and seepage and to bring the system into compliance with the terms of General Permit 3–9010.¹

¶ 5. In its Findings of Fact and Conclusions of Law, the Commission expressed its concern over Stratton's “failure to build its stormwater system in compliance with its prior permits.” The Commission conceded that “[w]hile Stratton's plan is not the only way to [correct significant stormwater problems], it is the plan on the table[,] ... [and it] has been approved by the Agency of Natural Resources and is implementable immediately.” Emphasizing the importance that “the water quality and safety issues be resolved satisfactorily as soon as possible,” the Commission concluded that “issuing a permit with conditions is the most effective way to achieve this outcome.” The Commission provided that it would add “protections in the permit to ensure that solutions proposed by Stratton are effective in addressing the problems,” and that it would “retain jurisdiction over these matters.” In its conclusion, the Commission found that the Treetop Project would be in compliance with Act 250 criteria if it was “completed and maintained as represented in the application and other representations of the Applicants, and in accordance with the findings and conclusions of this decision and the conditions [herein].”

¶ 6. Following a decision by the Commission on October 21, 2013 to approve Act 250 Permit # 2W1142–D (amended permit) with conditions, both Stratton and the Association moved to alter and amend the amended permit. After making minor changes, the Commission issued a Memorandum of Decision on November 15, 2013, granting the amended permit. The amended permit included several conditions, including conditions that required Stratton to repair the stormwater retention pond pursuant to approved plans on or before September 1, 2014, and to provide weekly reports on the progress of the repairs until completion. By that time of year, however, the weather made further site work impossible. Relevant to this appeal, permit Condition 14 provided:

The Commission reserves the right to review erosion, the ability of the land to hold water, stormwater management and revegetation issues outlined in these proceedings and to evaluate and impose additional conditions as needed.

(Emphasis added.) Importantly, neither party appealed the amended permit, which became final and binding on December 15, 2013.

¶ 7. In January 2014, the Association provided the Commission with information about the status of the stormwater management system, including a letter from Stratton's engineer, plans for remediation dated December 13, 2013, and the Association's response to those filings. Shortly thereafter, on February 7, 2014, the Commission issued a Notice of Reconvened Hearing on the amended permit. The notice was issued pursuant to the authority the Commission reserved unto itself under Condition 14 and indicated the Commission's intent to discuss whether additional conditions were necessary to address problems with the stormwater management system. Following hearings, the Commission issued a Memorandum of Decision on May 16, 2014 “declin[ing] to impose additional permit conditions with respect to [the amended permit],” and affirming the “adequacy of the conditions of the permit, which was not appealed.” The Commission also noted that, “given there is an active enforcement action [underway] by both [the Agency of Natural Resources] and the [Natural Resources Board], we are assured that there will be oversight regarding compliance with the relevant state requirements, including conditions of [the amended permit], which were not appealed.”²

¶ 8. The Association timely appealed the Commission's May 16, 2014 Memorandum of Decision declining to impose further conditions on Stratton to the Environmental Division of the Superior Court. Stratton then moved to dismiss the appeal, alleging that the questions raised on appeal were either collateral attacks on the unappealed amended permit or outside the scope of the Environmental Division's de novo review. On November 14, 2014 the Environmental Division dismissed the appeal, finding, relevant to the matter now before this Court, that:

The sole purpose of Condition 14 is to ensure compliance with the initial Permit and Permit Amendment. This authority does not belong to the Commission. Rather, it rests with the Natural Resources Board's authority to ensure compliance with an Act 250 Permit and its conditions through its enforcement powers.... the Association cannot use Condition 14 to privately enforce the Permit or Permit Amendment.

Treetop Dev. Co. Act 250 Application, No. 77–6

–14 Vtec, slip op., at 3 (Envtl.Div.Vt.Sup.Ct. Nov. 14, 2014), https://www.vermontjudiciary.org/GTC/Environmental/Opinions.aspx (citations omitted). The Environmental Division also later denied the Association's motion for relief from judgment, in which the Association claimed that the Environmental Division acted outside its authority in concluding that Condition 14 was unenforceable because the amended permit was not appealed. Treetop Dev. Co. Act 250

Application, No. 77–6 –14 Vtec, slip op., at 3 (Envtl.Div.Vt.Sup.Ct. Mar. 25, 2015), https://www.vermontjudiciary.org/GTC/Environmental/Opinions.aspx. In response, the Environmental Division noted that “[i]t would be irrational to read the Commission's decision on the [amended permit] as granting an Act 250 permit despite insufficient findings of compliance with Act 250,” and that “a district commission simply cannot use a permit condition to reserve the authority to reopen a final and binding Act 250 permit sua sponte in order to enforce the permit or impose conditions.” Id. The Environmental Division further provided that “[t]he injustice alleged by the Association stems from its free, calculated, and deliberate choice not to take an appeal” from the amended permit. Id.

¶ 9. This appeal from the Environmental Division's decision followed. Our review of “issues of law or statutory interpretation is de novo.” In re Vill. Assocs. Act 250 Land Use Permit, 2010 VT 42A, ¶ 7, 188 Vt. 113, 998 A.2d 712

. De novo review allows this Court to proceed with a nondeferential, on-the-record review. See In re Gulli, 174 Vt. 580, 582, 816 A.2d 485, 488 (2002) (mem.) (“Questions of law are reviewed de novo, allowing us to proceed with a nondeferential, on-the-record review.”).

¶ 10. The Association alleges that the Environmental Division erred in granting Stratton's motion to dismiss the appeal because Condition 14 is a valid and enforceable permit condition reserving jurisdiction over the stormwater system at the Treetop Project and allowing the Commission to amend or add conditions as necessary to bring the system into compliance with Act 250. The Association also asserts that it based its decision not to...