Vermont Bar Association

Seminar Materials

Employment & Administrative Law

Year in Review

October 14, 2016

Lake Morey Resort

Fairlee, VT

Speakers:

Steve Ellis, Esq.

Kyle Landis-Marinello, Esq.

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 1

1. Vermont Earned Sick Time Statute: Act 69. 21 V.S.A. Chap. 5, subchapter

4B

http://legislature.vermont.gov/assets/Documents/2016/Docs/ACTS/ACT069/ACT069%20As%20Enacted.pdf Take away:

Goes into effect on January 1, 2017.

Requires most employers to provide paid sick time to employees who work an average of 18 hours or more per week during a year.

Eligible employees accrue one of of EST for every 52 hours worked, subject to caps:

o 1/1/17-12/31/18: employers may limit to 24 hours in a 12-month period

o After 12/31/18: employers may limit to 40 hours in 12-month period

Carry-over or pay-off

1 year waiting period for new employees, may accrue but not use

May be used (i) to care for the employee’s or employee’s family member’s illness, injury, need for medical diagnosis or treatment, or need for preventative medical care; (ii) to obtain services or care for the employee or employee’s family member who is a victim of domestic violence, sexual assault, or stalking; or (iii) to care for a family member because the school or business where that individual is normally located during work hours is closed for public health or safety reasons.

2. Vermont “Ban the Box” Statute: 21 VSA §495j

http://legislature.vermont.gov/assets/Documents/2016/Docs/BILLS/H-0261/H-

0261%20As%20Passed%20by%20Both%20House%20and%20Senate%20Unofficial

.pdf

Take away:

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 2

prohibits requesting “criminal history record information” including arrests,

convictions or sentences, on initial employment application form, unless

state or federal law creates a mandatory or presumptive disqualification or

prohibits employer from employing individuals with convictions for certain

offenses

Employer may still ask about prior criminal records during a job interview or

once the applicant has been deemed otherwise qualified for the position,

but must give prospective employee, if eligible for the position under state

or federal law, opportunity to explain

Civil penalty of up to $100 per violation.

3. Vermont Independent contractor/ employee misclassification

Koski v. BlackRock Construction, LLC, Opinion No. 25-15WC http://labor.vermont.gov/wordpress/wp-content/uploads/koski.pdf

4. Federal Amendments to White Collar Exemption to OT Rules: 29 CFR 541

Take away:

Sets the standard salary level at the 40th percentile of earnings of full-time

salaried workers in the lowest-wage Census Region, currently the South

($913 per week; $47,476 annually for a full-year worker);

Sets the total annual compensation requirement for highly compensated

employees (HCE) subject to a minimal duties test to the annual equivalent

of the 90th percentile of full-time salaried workers nationally ($134,004);

and

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 3

Establishes a mechanism for automatically updating the salary and

compensation levels every three years to maintain the levels at the above

percentiles and to ensure that they continue to provide useful and effective

tests for exemption.

Amends the salary basis test to allow employers to use nondiscretionary

bonuses and incentive payments (including commissions) to satisfy up to 10

percent of the new standard salary level.

The effective date of the final rule is December 1, 2016. Future automatic

updates to those thresholds will occur every three years, beginning on

January 1, 2020.

For each affected employee newly entitled to overtime pay, employers

may:

o increase the salary of an employee who meets the duties test to at

least the new salary level to retain his or her exempt status;

o pay an overtime premium of one and a half times the employee's

regular rate of pay for any overtime hours worked;

o reduce or eliminate overtime hours;

o reduce the amount of pay allocated to base salary (provided that the

employee still earns at least the applicable hourly minimum wage)

and add pay to account for overtime for hours worked over 40 in the

workweek, to hold total weekly pay constant; or

o use some combination of these responses.

The circumstances of each affected employee will likely impact how

employers respond to this Final Rule.

Code of Federal Regulations: 29 C.F.R. Part 541: Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Computer and Outside Sales Employees

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 4

http://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&sid=48d6ee3b99d3b3a97b1bf189e1757786&rgn=div5&view=text&node=29:3.1.1.1.23&idno=29 29 C.F.R. Part 785: Hours Worked http://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&sid=48d6ee3b99d3b3a97b1bf189e1757786&rgn=div5&view=text&node=29:3.1.1.2.45&idno=29 Proposed Rule – Overtime: NPRM – Federal Register - Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Computer and Outside Sales Employees http://webapps.dol.gov/FederalRegister/HtmlDisplay.aspx?DocId=28355&AgencyId=14 Frequently Asked Questions Proposed Overtime Rule http://www.dol.gov/whd/overtime/NPRM2015/faq.htm Fact Sheet: Proposed Rulemaking to Update the Regulations Defining and Delimiting the Exemptions for “White Collar” Employees http://www.dol.gov/whd/overtime/NPRM2015/factsheet.htm United States Department of Labor: Fact Sheet 17A: Exemption for Executive, Administrative, Professional, Computer & outside Sales Employees Under the FLSA http://www.dol.gov/whd/overtime/fs17a_overview.pdf

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 5

Fact Sheet 17B: Exemption for Executive Employees Under the FLSA http://www.dol.gov/whd/overtime/fs17b_executive.pdf Fact Sheet 17C: Exemption for Administrative Employees Under the FLSA http://www.dol.gov/whd/overtime/fs17c_administrative.pdf Fact Sheet 17D: Exemption for Professional Employees Under the FLSA http://www.dol.gov/whd/overtime/fs17d_professional.pdf Fact Sheet 17G: Salary Basis Requirement and the Part 541 Exemptions Under the FLSA http://www.dol.gov/whd/overtime/fs17g_salary.pdf Fact Sheet 22: Hours Worked Under the FLSA http://www.dol.gov/whd/regs/compliance/whdfs22.pdf

5. Court decisions

ADA

Jarrell v. Hospital for Special Care, 626 Fed.Appx. 308 (2d Cir. Sept. 23, 2015)

Take away: indeterminate period of leave is not a reasonable

accommodation.

Dooley v. JetBlue Airways Corp., 636 Fed.Appx. 16 (2d Cir. Dec. 18, 2015)

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 6

Take away: Claim that employer failed to accommodate employee's

alleged disability by failing to provide her with training for "transitional duties"

failed where plaintiff never requested that accommodation.

ADEA

Friedman v. Swiss Re America Holding Corp., 643 Fed.Appx. 69 (2d Cir. March

18, 2016)

Take away: Evidence of ageist comments was not inadmissible heresay,

and coupled with evidence that a majority of RIF'd employees were older than 40

sufficient evidence of pretext to overcome employer's legitimate non-

discriminatory basis for termination (RIF) and demonstrate "but for causation" to

defeat summary judgment for purposes of ADEA claim.

Dunaway v. MPCC Corp. and Joseph Urbanati, 2016 WL 5387259 (2d Cir. Sept.

27, 2016)

Take away: Urbinati made several references to age, direct and indirect,

when he interviewed Dunaway. The ADEA, however, "does not make all

discussion of age taboo." Raskin v. Wyatt Co., 125 F.3d 55, 63 (2d Cir. 1997). "[A]n

employer's concern about the economic consequences of employment

decisions," such as the likelihood of an employment candidate's retirement within

a short timeframe, "does not constitute age discrimination under the ADEA, even

though there may be a correlation with age." Criley v. Delta Air Lines, Inc., 119

F.3d 102, 105 (2d Cir. 1997). More broadly, employers may consider factors that

"are empirically intertwined with age" without violating the ADEA "so long as they

are motivated by 'some feature other than the employee's age.' " Id. (quoting

Hazen Paper Co. v. Biggins, 507 U.S. 604, 609 (1993)).

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 7

Arbitration

Credit Suisse Securities (USA) LLC v. Tracy, 812 F.3d 249 (2d Cir. Jan 28, 2016)

Take away: FINRA does not preclude enforcement of pre-dispute

agreement requiring arbitration in non-FINRA forum (employer's United States

Employment Dispute Resolution Program required AAA or JAMS). Employees

required to dismiss FINRA arbitration and pursue claims in accordance with

agreement.

Virk v. Maple-Gate Anesthesiologists, P.C., 2016 WL 3583248 (2d Cir. July 1,

2016)

Take away: Under FAA, district court lacks discretion to dismiss, rather

than stay, case where court finds that issue is referable to arbitration and any

party has requested a stay; dismissal vacated and case remanded with

instructions to enter a stay pending outcome of arbitration.

At Will Presumption

Langenkamp v. Olson, 628 Fed.Appx. 50 (2d. Cir. Oct. 15, 2015)

Take away: Job offer letter describing “12-month position and “annual

salary” does not overcome at-will presumption – but, statement that employee is

required to follow employer’s policies and procedures sufficient to support claim

for breach of contract where employer failed to follow those procedures in

termination of employee.

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 8

Collective Bargaining/ Concerted Protected Activity

N.L.R.B. v. Sprain Brook Manor Nursing Home, LLC, 630 Fed.Appx. 69 (2d Cir.

Nov. 18, 2015) (D. Vt., Reiss, C.J.)

Take away: Threatening employee who requests union rep at discharge

meeting unlawfully interfered with employee’s rights under NLRA; evidence

supported finding that employee was terminated for union activities and

employer’s stated reasons were pretextual.

In re Election Petitions, 2016 VT 7 (Jan. 8, 2016).

Take away: Deputy states attorneys, victim advocates and secretaries in

state's attorney's offices are municipal employees under MERA for purposes of

collective bargaining. VLRB decision reversed and remanded.

Contract

Flannigan v. Vulcan Power Group, LLC, 642 Fed.Appx. 46 (2d. Cir. March 15,

2016)

Take away: Plaintiff's former employer breached contract by not paying

commission. $766,240 for lost wages and $300,000 for compensatory damages

and $900,000 in punitive damages for filing meritless counterclaims and servicing

subpoenas on plaintiff's clients in retaliation for her bringing her lawsuit.

O'Grady v. BlueCrest Capital Management LLP, 646 Fed.Appx. 2 (2d Cir. April 14,

2016) (New York law)

Take away: Employer did not breach contract by failing to pay discretionary

bonus; employee not entitled to severance where he did not sign valid and

irrevocable release required by contract for no-cause termination, despite

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 9

employee's argument that employer "stymied" his ability to do so by firing him for

cause.

Equal Pay

Vermont Human Rights Com'n v. State, Dept. of Corrections, 2015 VT 138136

A.3d 188 (Dec. 24, 2015) (Toor, J.)

Take away: State met its burden of proving that male employee's higher

pay than female employee's resulted from a "bona fide factor other than sex" for

purposes of VFEPA unequal pay claim.

Evidence/Procedure

Muktadir v. Bevacco Inc., 631 Fed.Appx. 1 (2d Cir. Nov. 20, 2015)

Take away: Trial court did not abuse discretion by permitting cross-

examination of employee regarding similar complaints of insults against another

employer because evidence “might suggest that he did not correctly recall at

which workplace he heard them or, more nefariously, that they were products of

his invention. In either case, a jury could reasonably infer that he was not

subjected to the insults at [Defendant].”

Robinson v. Purcell Const. Corp., 647 Fed.Appx. 29 (2d Cir. April 25, 2016)

Take away: Employee's claim in second lawsuit barred by res judicata,

despite court's denial of motion to amend in first lawsuit.

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 10

Davis v. Koffee Kup Bakery, Inc., 2016 WL 4411399 (D. Vt. August 18, 2016)

(Reiss, C.J.)

Take away: Genuine issues of disputed fact precluded employer's MSJ on

retaliatory constructive discharge age discrimination claim. Employer's EEOC

submission contained admissions, notwithstanding employer's attempt to amend

the submission on the ground that the admissions were inaccurate. "A pleading

prepared by an attorney is an admission by one presumptively authorized to

speak for his principal. ... When a pleading is amended or withdrawn, the

superseded portion ceases to be a conclusive judicial admission; but it still

remains as a statement once seriously made by an authorized agent, and as such

it is competent evidence of the facts stated, though controvertible, like any other

extra-judicial admission made by a party or his agent."

Kovaco v. Rockbestos-Suprenant Cable Corp., 2016 WL 4434396 (2d Cir. Aug. 22,

2016)

Take away: Employee's statement on application for SSDI benefits judicially

estopped him from claiming he was qualified for the position he was fired from,

precluding his ADA, ADEA and Title VII claims.

FLSA

Greenwalt v. AT&T Mobility LLC, 642 Fed. Appx. 36 (2d Cir. March 14, 2016)

Take away: Genuine issues of fact precluded summary judgment as to

whether security firm and AT&T stores were security guards' joint employer for

purposes of FLSA claim.

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 11

Perez v. City of NY, 2016 WL 4087216 (2d Cir. Aug. 2, 2016)

Take away: Genuine issues of fact precluded SJ on assistant park rangers'

"donning and doffing" claim under FLSA on issue whether uniforms including

bullet proof vests and utility belts holding baton, pepper spray, and handcuffs

were "integral and indispensable to the principle activities" of the rangers'

employment.

Public Employment

Lynch v. Ackley, 811 F.3d 569 (2d Cir. Jan 28, 2016)

Take away: Officer’s role in union endorsement of candidate for mayor

critical of police chief was as private citizen, and therefore protected by First

Amendment. Police Chief entitled to qualified immunity on retaliation claim

where allegedly retaliatory conduct consisted of chief’s exercise of her own core

First Amendment rights to defend herself against officer’s verbal attacks. Police

Chief entitled to summary judgment.

Bowles v. O’Connell, 2016 WL 831931 (Feb 29, 2016)

Take away: USPO employment claims. Westfall Act certifications struck

and motion to dismiss denied with respect to actions outside scope of Post

Master’s employment. To the extent certifications were not struck, government

immune from suit and entitled to dismissal because plaintiff failed to exhaust

administrative remedies and government had not waived sovereign immunity for

claims for defamation and interference with contract rights.

Bain v. Wrend, 2016 WL 4064030 (D. Vt. July 28, 2016) (Crawford, D. J.)

Take away: Last Chance Agreement was not sufficiently clear to operate as

a release of all of terminated teacher's civil claims, including First Amendment

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 12

retaliation claims, which were otherwise sufficiently pleaded; but plaintiff's

"stigma plus" claim was preclude by his failure to avail himself of name-clearing

hearing. Allegations that superintendant was acting outside the scope of her

official duties were sufficient to withstand motion to dismiss asserting immunity

from liability for VFEPA age and sex discrimination and IIED.

Retaliation

Brayboy v. O'Dwyer, 633 Fed.Appx. 557 (2d Cir. Jan 28, 2016)

Take away: Failure to investigate a complaint cannot be considered an

adverse employment action for purposes of making out a prima facie retaliation

claim based on the same complaint. Administrative leave with pay during

investigation does not, without more, constitute adverse employment action.

Thompson v. Odyssey House, 2016 WL 3391268 (2d Cir. June 16, 2016)

Take away: Excessive scrutiny is not an “adverse employment action” for

purposes of retaliation claim under § 1981; employee’s failure to notify employer

of alleged disability precluded claim for failure to accommodate under ADA.

Vasquez v. Empress Ambulance Serv., Inc., 206 WL 4501673 (2d Cir. Aug. 29,

2016)

Take away: Second Circuit expressly recognizes "cat's paw" theory of

liability in Title VII retaliation cases, but only where the retaliation by low-level

employee is attributable employer's own negligence. "Only when an employer in

effect adopts an employee's unlawful animus by acting negligently with respect to

the information provided by the employee, and thereby affords that biased

employee an outsize role in its own employment decision, can the employee's

motivation be imputed to the employer and used to support a claim under Title

VII. Put simply, an employer can still "just get it wrong" without incurring liability

Labor and Employment Law Year in Review

Vermont Bar Association Annual Meeting, October 2016 Page 13

under Title VII, Supp. App'x 114, but it cannot "get it wrong" without recourse if in

doing so it negligently allows itself to be used as conduit for even a low-level

employee's discriminatory or retaliatory prejudice."

Unemployment Compensation

Riendeau v. Department of Labor, 2016 WL 4446557 (Vt. Supreme Court, August

19, 2016)

Take away: Claimant was disqualified from unemployment benefits

because she left her employment voluntariliy and without cause attributable to

her employer. Although claimant’s prediction of the outcome of her disciplinary

proceedings may have been well-founded, her decision to resign rather than see

process through does not amount to “good cause attributable to” employer.

Administrative Law Year in Review 2015 – 2016

In re Beach Properties, Inc.

October 16, 2015

133 A.3d 854

2015 VT 130

MORSE, J. (Ret.), Specially Assigned.

¶ 1. Mary McGuire and Douglas Grover separately appeal from orders of the

Public Service Board granting Basin Harbor Club (BHC) a certificate of

public good for the installation of a photovoltaic net metering system, and

denying McGuire's motion *856 for reconsideration. We conclude that the

Board erred in denying McGuire's motion for reconsideration on the ground

that she lacked party status, and therefore reverse and remand.

***

¶ 21. Viewed in the light of these facts, McGuire's claim to de facto party

status is persuasive. The notice she received of the proposed solar-energy

project invited her to submit comments, characterized her as one of a number

of “required parties” who had received such notice, and yet never informed

her of the need to affirmatively request formal party status by moving to

intervene. The Board thereafter accepted her filings, directed BHC to

respond, ordered an additional glare-analysis in response to her expressed

concerns, and ultimately issued a decision focused principally on the

arguments raised by McGuire and her neighbors. That she would have

viewed herself as a party to the proceeding in these circumstances—

particularly as a pro se litigant—is therefore eminently reasonable.

Furthermore, BHC has not identified any basis for concluding that it was

prejudiced by the absence of a formal intervention motion.

¶ 22. We thus conclude that the equities for treating McGuire as a de facto

party weigh strongly in her favor; that she actively *862participated in the

proceeding; and that, regardless of the Board's ultimate decision concerning

the project's aesthetic impact, she had a strong, personal stake in the

outcome. See In re New Cingular Wireless, 2012 VT 46, ¶ 4, 54 A.3d

141 (noting Board's ruling that adjoining landowners “had articulated a

sufficient interest in ensuring that [aesthetic and other] impacts did not come

to pass to warrant permissive intervention” despite their failure “to provide

any evidence, other than a site plan depicting the location of their properties,

to support the contention that the project may result in the impacts they

described”). Accordingly, we find that the requisites for according de facto

party status were met.

¶ 23. We stress that our conclusion in this regard is limited to the specific set

of facts in the record before us. We do not hold that any and all participants

in such proceedings may attain party status without the need to formally

move to intervene. Significant factors specific to this case include: (1)

McGuire is an adjoining landowner who was entitled to, and did, receive

notice of BHC's application; (2) McGuire was not represented by counsel; (3)

the notice referred to those who had received it as “required parties,” and

McGuire was on the list of “notified parties”; (4) the notice laid out specific

steps and timelines for McGuire to comment on the application, but did not

reference her right to intervene and did not explain the distinction between

“commenting” and actually “intervening” as a party, and did not describe the

process and timelines for intervention; (5) the Board responded to McGuire's

motions as if she were a party; and (6) McGuire raised substantial issues that

were central to the Board's analysis. Had any of these circumstances not been

present, the de facto party analysis might have been different. The essence of

equity is that it applies only in those exceptional cases “wherein the law (by

reason of its universality) is deficient.” Bucklin v. Beals, 38 Vt. 653, 662

(1866).

In re VTel Wireless Inc.

November 20, 2015

134 A.3d 1227

2015 VT 135

SKOGLUND, J.

¶ 1. Appellants Susan Beal and David Pearson appeal from a decision of the

Public *1228 Service Board granting a certificate of public good (CPG) for the

installation of a telecommunications facility by VTel Wireless, Inc. in the

Town of Bennington. Appellants contend the Board erred in finding that they

had failed to demonstrate: (1) a “substantial interest” to intervene in the

proceeding; and (2) a “significant issue” to warrant a hearing. We affirm.

***

¶ 10. In reviewing the Board's issuance of a CPG we have “emphasize[d] the

limited nature of our review.” In re UPC Vermont Wind, LLC, 2009 VT 19, ¶

2, 185 Vt. 296, 969 A.2d 144. “When the Board evaluates a petition for a CPG

under 30 V.S.A. § 248, it is engaging in a legislative, policy-making

process.” Id. (quotation omitted).4 In so doing, it “must exercise its discretion

to weigh alternatives presented to it, utilizing its particular expertise and

informed judgment.” Id. (quotation omitted). Thus, we “give great deference

to the Board's expertise and judgment, and accord a strong presumption of

validity to the Board's orders.” Id. (quotation omitted).

***

¶ 15. The Board went on to specifically acknowledge appellants' “expressed

... desire that the [p]roject be located in an area that is not near their

property,” but found that they had “not shown that the [p]roject in its current

location raises a significant issue.”Regardless of the legal relevance of a

project's aesthetic impact on private parties under § 248a, therefore, it

appears that the Board considered appellants' argument but found that it

lacked sufficient weight to raise a “significant issue” requiring a hearing on

the merits. See The American Heritage College Dictionary 721, 1268 (3d

ed.1993) (defining “significant” as “[h]aving or likely to have a major effect;

important,” and “issue” as a point in “debate, or dispute”). This was a decision

well within the scope of the Board's expertise and discretionary authority,

and appellants have not shown on the record presented that its discretion

was abused or exercised on clearly untenable grounds. In re Cross

Pollination, 2012 VT 29, ¶ 8, 191 Vt. 631, 47 A.3d 1285 (mem.) (“The Board's

consideration of a petition for a certificate of public good is a legislative,

policy-making process and is thus accorded great deference.”) (quotation

omitted); In re UPC Vermont Wind, LLC, 2009 VT 19, ¶ 2, 969 A.2d

144 (noting that Board “must exercise its discretion to weigh alternatives

presented to it, utilizing its particular expertise and informed judgment.”

(quotation omitted)). We thus discern no basis to disturb the judgment.7

Affirmed.

In re Treetop Development Co. Act 250 Development

February 12, 2016

143 A.3d 1086

2016 VT 20

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.

***

¶ 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

appeal the amended permit on the Commission's reservation of authority to

impose further conditions in order to ensure the stormwater management

system's compliance with Act 250, and that Stratton's motion to dismiss is a

collateral attack on Condition 14. Stratton, on the other hand, contends that

under the Association's view, Condition 14 amounts to a key that can be used

to reopen the door to amend the permit at any time and impose additional

conditions, preventing finality. Both Stratton and the NRB argue that

Condition 14 is an unenforceable condition subsequent and that *1090 the

Association's appeal is a collateral attack on the amended permit.3 We find

that condition 14 is invalid and affirm the Environmental Division's decision,

rendering Condition 14 unenforceable.

In re Rutland Renewable Energy, LLC

April 29, 2016

2016 WL 1729592

2016 VT 50

DOOLEY, J.

*1 ¶ 1. The Town of Rutland (Town) and five adjoining landowners

(neighbors) appeal from the Vermont Public Service Board's grant of a

certificate of public good (CPG) under 30 V.S.A. § 248 to Rutland Renewable

Energy, LLC (RRE) for construction of the Cold River Solar Project (Project),

a 2.3 megawatt (Mw) solar photovoltaic electric generation facility. The Town

and neighbors argue that the Board incorrectly held that the project will not

unduly interfere with the orderly development of the region, will not have an

undue adverse effect on aesthetics, and will not have an undue adverse

impact on historic sites. We affirm.

***

¶ 8. This Court applies a “deferential standard of review in appeals from the

Public Service Board.” In re Green Mountain Power Corp., 162 Vt. 378, 380,

648 A.2d 374, 376 (1994). We recognize that:

When the Board evaluates a petition for a CPG under 30 V.S.A.

§ 248, it is engaging in a legislative, policy-making process. The

Board must exercise its discretion to weigh alternatives

presented to it, utilizing its particular expertise and informed

judgment. We give great deference to the Board's expertise and

judgment and accord a strong presumption of validity to the

Board's orders. We will affirm the Board's findings unless they

are clearly erroneous, and an appellant bears a heavy burden of

demonstrating clear error.

In re UPC Vt. Wind, LLC, 2009 VT 19, ¶ 2, 185 Vt. 296, 969 A.2d

144 (citations omitted). This is a highly deferential standard of review.

Despite the limited standard of review, “we do not abdicate our responsibility

to examine a disputed statute independently and ultimately determine its

meaning.” In re MacIntyre Fuels, Inc., 2003 VT 59, ¶ 7, 175 Vt. 613, 833 A.2d

829 (mem.).

***

ROBINSON, J., concurring.

¶ 30. A critical unanswered question in this case is: what does the Board

have to do in order to give “due consideration” to the recommendations of

municipal legislative bodies and planning commissions pursuant to 30 V.S.A.

§ 248(b)(1)? The majority does not address this question because it concludes

that the dearth of evidence as to the regional as opposed to the municipal or

local impact of the project is dispositive.6 The dissent persuasively catalogs

the Board's myriad slights of the Town's enacted standards, and calls for a

“more balanced” approach, but does not grapple with the meaning of “due

consideration” and its impact on the scope of our appellate review.

¶ 31. Although I agree with the dissent that the Board indulged every

inference against the limitations on siting solar facilities reflected in the

Town's standards, and afforded no deference whatsoever to the solar siting

standards of the town in which the project was to be located, I concur in the

affirmance of the Board's decision because as currently written, §

248(b)(1) does not require any such deference. Nobody contends that the

Board here ignored or failed to acknowledge the Town's solar siting

standards. The challenge here is to the substance of the Board's treatment of

those standards—its explanations of why it declined to assign significant

weight to various provisions. The Town's argument boils down to the claim

that the Board was insufficiently respectful of the Town's recommendations

and input, as reflected in its solar siting standards. But nothing in the plain

language of the statute, our prior decisions construing the statute, or the

recent legislative debate highlighted by the Town supports the contention

that the Board must defer to the Town's recommendations to any

degree. Moreover, the Town's suggestion that we review the Board's decision

to determine whether it was made in “good faith,” is unworkable for several

reasons.

***

REIBER, C.J., dissenting.

¶ 44. I cannot agree with the majority that the Public Service Board gave due

consideration to the Town of Rutland's recommendations for this solar energy

project or sufficient regard to the Town's standards for preserving the project

area's natural beauty and aesthetics, as required by law. The choice

confronting the Board here was not between yielding to the Town's solar-

energy standards or simply disregarding them. “Due consideration” of the

Town's recommendations and concerns required a more balanced approach

which, if properly applied, might well have produced a different result.

Accordingly, I respectfully dissent.

In re Costco Stormwater Discharge Permit

August 5, 2016

2016 WL 4150487

2016 VT 86

ROBINSON, J.

*1 ¶ 1. This appeal is from a decision of the environmental division of the

superior court affirming several permits issued to appellee Costco Wholesale

Corporation for the expansion of its existing retail store and the addition of

an adjacent six-pump gasoline station in the Town of Colchester. Appellants

R.L. Vallee, Inc. and Timberlake Associates LLP own retail gasoline-service

facilities located near the planned development. Appellant Vallee contends

the trial court erroneously: (1) determined that Costco's proposed traffic-

mitigation measures were sufficient for issuance of an Act 250 permit; (2)

made findings concerning the impact of an underground stormwater outlet

pipe not addressed below, and with respect to which the court limited cross

examination by Vallee's counsel; (3) concluded that the project would not

adversely affect a Class 2 wetland for issuance of an individual wetland

permit; and (4) excluded testimony and a related exhibit prepared by

appellant Vallee's wetland consultant. Appellant Timberlake asserts that the

trial court erred in relying on a presumption with respect to the project's

impact on water pollution and waste disposal under Act 250. We affirm.

***

¶ 5. We note, as well, that “we generally give substantial deference to an

agency's interpretations of its own regulations”—in this case ANR's

interpretation of the regulations governing the wetland and stormwater

discharge permits at issue. In re ANR Permits in Lowell Mountain Wind

Project, 2014 VT 50, ¶ 15, 196 Vt. 467, 98 A.3d 16. Appellants here “bear the

burden of showing that ANR's interpretation is wholly irrational and

unreasonable in relation to its intended purpose.” Id. ¶ 17 (quotation

omitted).

Agency of Natural Resources v. McGee

August 19, 2016

2016 WL 4425170

2016 VT 90

EATON, J.

¶ 1. In this environmental enforcement action, the Agency of Natural

Resources (ANR) issued a violation and imposed a penalty of $10,000 against

defendants Hugh McGee and Eileen McGee for placing unpermitted fill in a

Class II wetland. Defendants appealed and, following a site visit and

evidentiary hearing, the Environmental Division concluded that the land was

not exempt, upheld the violation, and reduced the penalty to $3647. On

appeal, defendants argue that the land is used for grazing horses and it

therefore meets the requirements of the farming exemption in the wetlands

regulations. We conclude that the evidence supports the Environmental

Division's finding that the area had not been used consistently to grow food

or crops since 1990 and therefore any exemption had expired, and affirm.

Plum Creek Maine Timberlands, LLC v. Vermont Department of

Forests, Parks and Recreation

September 16, 2016

2016 WL 4944972

2016 VT 103

REIBER, C.J.

¶ 1. This appeal concerns a timber harvest by landowner Plum Creek Maine

Timberlands, LLC in forestland enrolled in the current-use, tax-incentive

program. The Vermont Department of Forests, Parks and Recreation (FPR)

issued an adverse inspection report, concluding that Plum Creek violated its

forest-management plan and failed to comply with minimum acceptable

standards during the harvest. Consequently, the Department of Taxes

removed the land from the current-use program and levied a tax assessment.

Following Plum Creek's appeal, the superior court reversed those

administrative decisions. FPR now appeals, arguing that the superior court

failed to give appropriate deference to FPR's determination of the proper

methodology for measuring compliance with the forest-management plan. We

reverse the court's decision, and remand.

***

¶ 28. The superior court viewed the question of how RBA should be measured

for purposes of determining compliance with the forest-management plan as

a question of fact, not an area of agency expertise entitled to deference, and

compared the relative credibility of the experts to determine how to measure

compliance. As explained more fully below, this was error. FPR's decision on

the methodology for determining compliance was entitled to deference, and

Plum Creek had the burden to show it was “ ‘wholly irrational and

unreasonable in relation to its intended purpose.’ ” ANR Permits, 2014 VT 50,

¶ 17, 196 Vt. 467, 98 A.3d 16 (quoting Town of Killington, 2003 VT 88, ¶ 6,

176 Vt. 70, 838 A.2d 91).

¶ 29. Like other cases where this Court has applied a deferential standard of

review to an agency decision, in this case, deference is due because the

methodology for determining compliance is an area over which FPR has

broad statutory authority and the relevant expertise. See Id. ¶ 16 (explaining

that agency is entitled to deference where decision is within agency's area of

expertise and within statutory authorization); In re Williston Inn Grp., 2008

VT 47, ¶ 13, 183 Vt. 621, 949 A.2d 1073 (mem.) (explaining that where

Legislature entrusts implementation of statute to agency, this Court gives

deference to agency's interpretation of those laws). The statutory scheme

underpinning the current-use program contains the standards to be applied

to all UVA-enrolled land and highlights the importance of oversight by FPR.

FPR is entrusted with the authority both to set standards for acceptable

forest management and to enforce compliance with those standards. See 32

V.S.A. § 3752(9)(B)(iii) (defining “managed forestland” as property that is

managed in accordance with standards established by FPR); Id. § 3755(c)

(entrusting FPR with power to determine if “management of the tract is

contrary to the conservation or forest management plan” and to issue

inspection report if it so finds). Consequently, FPR is entitled to deference in

determining how to measure compliance. This is exactly what this Court

recognized in Jones, 2004 VT 49, ¶ 14, 177 Vt. 81, 857 A.2d 271 (giving

deference to FPR on decision regarding violation of forest-management plan).

¶ 30. The superior court in essence determined that Plum Creek's

methodology was better than FPR's. This is not the role of the court. “We

have cautioned that courts are not ‘a higher environmental agency entrusted

with the power to make environmental law and policy,’ but rather exercise a

‘narrow role in ensuring that the decisions of ANR are made in accordance

with law.’ ” Id. ¶ 14. Where there are questions about “complicated

methodologies within an agency's expertise” a reviewing court, even in the

context of a de novo hearing, must give deference to the agency's

decision. ANR Permits, 2014 VT 50, ¶ 16, 196 Vt. 467, 98 A.3d 16.

¶ 31. In assessing the validity of FPR's violation, the trial court and this

Court on appeal must give deference to FPR's methodology. This does not

mean that FPR's decisions will be rubber-stamped, but deference is accorded.

“Absent a clear and convincing showing to the contrary, decisions made

within the expertise of such agencies are presumed correct, valid and

reasonable.” In re Johnston, 145 Vt. 318, 322, 488 A.2d 750, 752 (1985).

Review is limited to whether there was a “reasonable basis” for the agency

action. Id.; see In re DeCato Bros., Inc., 149 Vt. 493, 496, 546 A.2d 1354, 1356

(1988) (explaining that agency decision must meet minimum standard of

reasonableness).

***

DOOLEY, J., dissenting.

***

¶ 51. My disagreements with the majority are deep and extensive and take

many pages to fully explain. There are, however, three other points to which I

will return on numerous occasions, and I summarize them here as a road

map through this dissent. First, by statute, the standard for judicial review

in this case is de novo, a standard that by definition provides the broadest

and most extensive judicial review of administrative action. While the

majority has paid lip service to that standard, it has actually employed the

narrowest and most agency-deferential standard of review possible, turning

the statutory standard into its opposite. If the standard of review were

applied the way it is written, the superior court decision would be affirmed.

In In re Town of Sherburne, we recognized in regard to the standard for

review of administrative action that courts have a tendency to recite “a batch

of verbiage and then pay [ ] no attention to what it has said in determining

what to do.” 154 Vt. 596, 607, 581 A.2d 274, 280 (1990) (quoting 5 K. Davis,

Administrative Law Treatise § 29:27, at 456-57 (2d. ed. 1984)). This is exactly

what the majority has done here.

¶ 52. Second, the majority has reversed the decision of trial court, without a

remand, holding that as a matter of law the agency must prevail. At best,

this would be an unusual and exceptional action, particularly after four days

of trial and extensive evidence and findings of fact, none of which are found to

be erroneous. If the trial court employed the wrong standard of review, the

remedy is to remand the matter to the trial court to apply the right standard

in light of the evidence and findings of fact. After reading the majority

opinion, it is difficult to see what the purpose of the trial was or whether

Plum Creek's extensive evidence could even be considered. Indeed, it is hard

to understand the purpose of judicial review at all.

¶ 53. Third, the sole question on which this case turns is whether Plum Creek

violated a timber-harvesting plan that it drafted and the agency approved. I

have attached the plan to this dissent. The superior court found that Plum

Creek did not violate the plan. The State claims it did but does not identify

the language in the plan it says was violated. The majority adopts the theory

of the State because the State's interpretation of the plan is entitled to

deference, again with no specific identification of the requirement in the plan

that was violated. The result is that the State is entitled to create plan

requirements as it goes along, with no advance notice to a landowner and no

inclusion of the requirement in the plan document.

In re MVP Health Insurance Company

September 23, 2016

2016 WL 5342168

2016 VT 111

DOOLEY, J.

¶ 1. This case arises out of the rate filing submitted to the Green Mountain

Care Board (GMCB) by MVP Health Insurance Company (MVP) with respect

to the Agri-Services health insurance plan. Acting through its authority to

review and approve or deny health insurance rates in the State of Vermont,

GMCB found that the 2015 Agri-Services rate filing would not promote access

to quality health care and denied it on that basis. MVP appeals, arguing that

GMCB's disapproval was an arbitrary use of discretion based on vague

standards that unconstitutionally delegated authority to GMCB, that

GMCB's decision is not supported by the record, and that GMCB's statutory

interpretation of its authority is compelling error. We hold that 8 V.S.A. §

4062 is constitutional but find that GMCB's conclusions were not supported

by specific findings on the statutory criteria required for approval of health

insurance rates and, accordingly, reverse and remand for new findings

consistent with this opinion.

***

¶ 18. MVP next argues that even if GMCB's grant of discretion is found

constitutional, its decision in this case should nonetheless be reversed

because its conclusions “are not supported by specific findings on the

statutory criteria required for approval of health insurance rates.” MVP

alleges that the decision “fails to provide an adequate basis for review by this

Court,” as GMCB both failed to explain how the proposed rate did not

promote access to quality healthcare and was unfair, unjust, and inequitable

to plan members while simultaneously ignoring the relevant evidence and

basing its decisions on factors “that have no nexus [to] the proposed rates.”

We agree and, accordingly, reverse and remand for GMCB to make specific

findings, based on the statutory factors, to support its conclusions.

¶ 19. We approach this issue deferentially. This Court “will not interfere with

the decision of an administrative board made in the performance of a

discretionary duty in the absence of a showing of abuse of discretion resulting

in prejudice to one of the parties.” Vincent, 148 Vt. at 536, 536 A.2d at 929.

Therefore, we “will not delve into the reasons for the Board's actions absent

evidence of an abuse in the exercise of its discretion.” Id. at 536–37, 536 A.2d

at 929.

***

¶ 22. Although the standard of review precludes reversal absent a compelling

indication of error, in this instance, we must conclude that GMCB's

explanation of its reasoning is too sparse to show how the “events” supported

its decision and were consistent with the statutory standards in 8 V.S.A. §

4062(a)(3). Two of the events appear to support the conclusion that they

“illustrate a lack of accountability to the Board”—the mislabeling of the

nature of the plan and the failure to follow through on the 2014

representation that MVP would discontinue the plan. It is unclear, however,

how these events relate to the statutory standards and why the proper

remedy for these facts is to deny approval of any rate increase.