Monday, February 20, 2017

Permit from the Past

In re Musto Permit, 2014 VT 103

By Andrew Delaney

This is old news—not “fake news” but definitely old news. The case was decided about two-and-a-half years ago, and we’re just finally getting around to it. Look. You get what you pay for.

The Mustos applied to the Agency of Natural Resources (ANR) for a permit for a wastewater system and a water supply for their home on Lake Bomoseen. In the application, they described the project as “reconstruction of a 3 bedroom year-round single use family residence using a new wastewater disposal system and drilled bedrock water supply well.” When I first skimmed through the opinion, I thought this was an odd thing for the SCOV to quote directly. As we’ll soon find out, however, this is important.

The ANR granted the permit. Neighbor who, along with her brothers, owns the parcel next door filed a petition with ANR to revoke the permit about five months after it was issued. She claimed that the Mustos lied about the number of bedrooms in the camp. The ANR had a hearing and denied the request to revoke the permit. Neighbor appealed to the environmental court—both the permit and the ANR’s denial of revocation. The environmental court did a de novo review on the record and concluded that there wasn’t any reason to revoke the permit.

Neighbor appeals.

The SCOV begins with the wastewater permit itself. Timing is important here. The permit was issued in March of ’09. Though in the meantime, neighbor filed a petition to revoke the permit with the ANR, the environmental court didn’t get an appeal of the permit until over a year after the permit was issued. This statute gives 30 days to file an appeal with the environmental court. Naturally, the environmental court found the appeal of the permit untimely. Neighbor argues that the environmental court’s dismissal of her appeal violated her due-process rights and “fundamental administrative fairness.” The SCOV is not convinced.

The primary argument for timeliness is that evidence didn’t come to light until right before she filed the permit appeal—namely, that ANR construes the definition of bedroom broadly.

The time period “to file an appeal is a jurisdictional requirement defined by statute.” In other words, you snooze, you lose. If an appeal isn’t filed timely, the court doesn’t have jurisdiction. The SCOV doesn’t buy neighbor’s apparently subjective when-you-feel-you-have-the-evidence-is-the-timeframe-to-file pitch. The SCOV reasons that “the constitutional dimension of the rights of landowners with respect to permitting on adjoining properties depends upon the legal framework applicable to the permitting scheme in question.” In the SCOV’s view, there was no violation of the legal framework, and neighbor doesn’t give any reason why she couldn’t have filed her appeal sooner.

Finally, on the wastewater-permit appeal issue, the SCOV notes that neighbor wrote a letter a couple months after the permit issued to the ANR raising her claim that the applicants lied about the number of bedrooms. So, the SCOV is just fine with the environmental court’s dismissal of the untimely direct appeal.

Moving on to the revocation proceedings, we get to the crux of the matter. Neighbor argues “that the application contained false and misleading information as to the number of bedrooms present in the camp, which ANR relied on in issuing the permit.” This is because the applicants put it down as a “3 bedroom” residence. Now, one of the alleged “bedrooms” is actually a multi-use-room with built-in beds. Neighbor says this is an “egregious manipulation of the state permitting system,” and led to the applicants’ success getting the permit and a reconstruction variance. Neighbor contends that the trial court blew it in not finding only two bedrooms and that applicants’ “false and misleading information about the number of bedrooms and their reconstruction plans require revocation of the permit.”

We’re dealing with agency rules and an agency’s interpretation of those rules, so a reversal only happens when there’s pretty clear—or “compelling indications of”—error.

And, yes, if one lies on a permit application, and the permit is issued, lying on the application will get your card punched or your permit yanked. Neighbor argued below that the multi-use room was not—under ANR definitions—a “bedroom” because it was used for other purposes. The multi-use room acted as a kitchen and living room as well as having the built-in beds. The ANR found testimony that “bedroom” was to be construed liberally persuasive. The purpose of the rules is to ensure that wastewater systems can handle the use of a structure.

This makes sense. If you have twenty people using a one-bedroom system, you could end up in deep . . . heh. At any rate, in this light, ANR did not find the information provided to be false or misleading, and the environmental court agreed. The SCOV makes three.

Neighbor argues that the evidence before the environmental court showed “the incontrovertible truth” that the “so-called third ‘bedroom’” wasn’t a bedroom. The evidence included a two-bedroom listing card, testimony from a former owner that the built-in beds were only used about 30% of the time, and a declaration that if a room is used for cooking and lounging it cannot by definition primarily function as a bedroom. But when applicants bought the property, the real-estate agent told them is slept six people comfortable-like. And, the SCOV points out, listing cards ain’t necessarily bomb-proof—in fact, neighbor’s property is listed as a zero-bedroom dwelling. As to the “primary use” argument, there’s a lot of single-room, multi-use properties out there—like yurts and hunting camps. A strict interpretation of the “bedroom” definition would mean places with convertible sleeping spaces “would never qualify for adequate wastewater design capacity.”

Based on the record and reasoning below, the SCOV affirms the ANR’s and the environmental court’s decisions to not revoke the permit. 

Neighbor’s final argument is that by calling the project reconstruction instead of new construction, applicants misled the ANR. It’s not the same footprint. There’s a rule that says, more or less, no variances for reconstruction that would increase design flow. Basically, the idea is that applicants—by stating that they intended to reconstruct rather than build fresh—hoodwinked ANR into issuing the permit on the basis that the house would be on the same footprint and not increase design flow.

The SCOV doesn’t agree. There’s a no-new-permit-required provision for reconstruction. ANR’s interpretation is that within fifty feet qualifies as reconstruction and neighbor hasn’t shown that the new construction (or reconstruction) isn’t within those parameters. It seems there’s a bit about conflict between the municipal and wastewater permits, but the SCOV is quick to point out that we’re not here on that.

Applicants file a cross-appeal arguing that neighbor has no standing, but SCOV doesn’t bother with that because it affirms the environmental court’s decisions in applicants’ favor.

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