Thursday, August 25, 2011

Permits of Walmart

In re JLD Properties of St. Albans, LLC, 2011 VT 87

The best way to think about today’s case is to consider it a Rorschach ink blot.  What you see probably says more about your views on development and conservation in Vermont and the process that has evolved to regulate and control it, then it does about the specific project, a long in the works strip mall that almost anywhere else in the United States would have been erected a dozen years ago.

But not in Vermont!  For the past 20 years, Jeff Davis, he of Taft Corners and UVM’s student center, has sought to put a Walmart in St. Albans near its northern boundary with the Town of Swanton.  Back in 1993, Developer Davis began with an Act 250 application seeking a permit that was ultimately denied for lack of evidence on what secondary growth and impacts the project would have on the financial capacity of the Town and region.  This decision was affirmed by the SCOV in 1997, and Developer walked away from his plans. 

Yet, land use dreams are never dead or far from re-application.  Fast forward to 2005, and Developer revives his plans and re-launches his application.  Now Developer wants a larger store, but he wants to build in an area that looks much different than it did in 1997.  Developer receives approval from the Town’s Development Review Board and the Act 250 District Commission.  Opponents appeal to the Environmental Court, where the case is re-tried and affirmed.  Opponents take their appeal to the SCOV.

On appeal, the Opponents raise three objections to Developer’s permits.  First, they argue that the Development Review Board’s approval was fatally flawed because of the blatant bias of several DRB members.  Second, the Opponents claim that the trial court erred in allowing the application to proceed given its prior rejection.  Third, the Opponents challenge the trial court’s finding that the proposal is compatible with existing land uses.  The SCOV addresses each point in turn before it affirms both permits, and we will follow the same structure.

The first issue centers on the Chair of the DRB.  At the beginning of the first hearing on the application, the Chair took it upon himself to open the meeting with a series of off-the-cuff comments that included several shocking statements denigrating the Opponents, labeling them as meddling outsiders who did not understand the realities of growth because they were too wrapped up in their personal ideas. 

A real gem they have up there.

This, of course, came before any evidence or testimony was offered.  As the SCOV notes, the Opponents could hardly expect a fair and impartial hearing with such a chair leading the adjudication process.  Both the Environmental Court and the SCOV have no trouble concluding that the Chair’s statements were out of line and violated the participants’ due process.

But such bad acts do not necessarily taint the process.  When the question becomes one of remedy, the SCOV agrees with the Environmental Court that any defects were effectively cured by the Environmental Court’s de novo hearing where the court took new evidence, made new findings of fact, and re-started the hearing process.  In other words, no matter how bad or egregious the Board acted below, its sins were washed away by the good at the environmental court during the re-hearing on appeal. 

This is not a new position for the SCOV, and it is one of the realities of environmental law.  You can see where the Opponents would be rending their shirts at this type of ruling.  Basically, they have to sit through a hearing, receiving abuse from a chair who goes out of his way to rule against them, and the only remedy is for a judge to re-hear the case—something that would happen regardless of what happened at the DRB.  One is put in mind of the words of Humpty Dumpty because apparently a standard process is a remedy when the courts say it is, no more or less. 

At the same time, the SCOV’s point is valid.  The remedy to a flawed hearing is a new hearing.  The appeal to the Environmental Court is a new hearing, which is not bound by any part of the Board’s decisions.  It is an effective do-over and is likely more satisfactory than a remand to a hostile board. 

By no stretch does the SCOV let the DRB off scot-free.  It has particularly strong language that warns against such behavior in the future and leaves the door open to possibility of revisiting this issue if a future case demonstrated that a board or members had a chronic history of such bias and hostility.  But for Opponents, this strong warning is hardly enough to overturn the Environmental Court’s ruling or reverse the appeal.

The next argument that the SCOV addresses concerns the successive application doctrine.  This is a hard issue for clients, civilians, and even some lawyers to grasp.  In a normal court action, the parties have one shot to make their case.  Once the court decides and the SCOV makes a final ruling, it is over.  If you lost, you do not get another shot at trying again or using arguments that you were saving.  It is done, and it is best to move on with your life.  In land use cases, however, there is no such thing as finality.  Applications that have been rejected can always be revived and permits that are denied one day can become approved and valid the next.

The reason for this lack of finality has to do with the subject matter.  Land use is a dynamic process.  Towns change, neighborhoods develop in unexpected ways.  Today’s illegal use is tomorrow’s growth center.  Therefore, the law encourages flexibility and allows owners to seek permits any number of times in order to develop their land.  While this doctrine can translate any developer into Scarlett O’Hara after a loss, it has the practical effect of turning any Opponent into a sentinel who must stand guard lest the Developer comes back and proposes what she had previously been denied. 

The good news is that the courts do put some brake on the process of re-application in the form of the successive application doctrine.  This legal standard says that developers can submit and re-submit their applications multiple times, but successive applications will only be considered if there is evidence that “a substantial change of conditions ha[s] occurred or other considerations materially affecting the merits of the request have intervened between the first and second application.”  This can be a difficult burden for the applicant who needs to show as a threshold matter that something relevant has changed that would make her second application acceptable where the first was not. 

In this case, Developer relied on testimony from engineers and economists to show that the proposed area had become a substantial commercial center.  Developer was able to point to the fact that the three major competitors that were cited in 1993 as business that would likely suffer business losses from his project had all gone out of business prior to 2005.  His experts pointed to the fact that the area, previously an agricultural zone, had been designated as a growth area by the Town, who had also installed sewer lines throughout the area.  Finally Developer offered financial investments in the local community to offset any impact it might have on services, which were likely to be lower given the area’s declining school enrollments and population. 

Opponents challenged these findings and cited to contradictory evidence and testimony in the records.  Their argument was that the Environmental Court ignored the flaws in the evidence and testimony, which undermines the findings and conclusions that the trial court reached.  Such arguments on appeal, though, are akin to pushing a rock up a hill.  Opponents get no traction here, and the SCOV finds more than sufficient evidence in the record to affirm the trial court’s findings. 

Let this be an abject lesson.  You have to win your factual fights at the trial court level.  If you cannot persuade a trial court of your facts, then you are not going to fare any better on appeal.  In fact, you are doomed.  Unless, the trial court so ignored the evidence and based its findings on either error or thin air, you are going to have a difficult time overturning even the worst findings.  This is because the SCOV is not in the fact finding business.  That is the province of the trial courts where the judge or jury can watch the witnesses, measure the testimony, ask questions, and make determinations that are impossible to glean from a written record. 

Opponents’ last argument is at once a particularly narrow, legalistic argument and a last stab at a broader review of the entire project.  It concerns the Town’s zoning ordinance that requires projects to be compatible with adjacent uses, particularly agriculture.  The Environmental Court in its first ruling noted that there were no adjoining agricultural uses.  Not so fast, say the Opponents, the regulation uses the word “adjacent,” which is broader than adjoining because an adjacent property need not touch the project but merely be in the neighborhood.  Therefore, it is the trial court’s obligation to review the project’s impact on the neighboring farm.  Opponents argue that this impact is incompatible with the farm and should cause the application to fail. 

The SCOV is not much concerned with the difference between the words adjoining and adjacent.  Even under the broadest term, the closest farm is separated from the proposed project by a highway, a brook and several businesses including an auto repair shop.  The SCOV agrees with the trial court, the impact is too far removed and the evidence supports a finding of compatibility.

So Opponents’ appeal is dismissed, and Developer’s permit is affirmed.  Walmart can start raking in the big northern Vermont bucks while environmentalists plot their next move in an on-going struggle from what Vermont, or at least Franklin County,  is going to look like for the next 20 years.  

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