ANR v. Bacon

STATE OF VERMONT
SUPERIOR COURT ENVIRONMENTAL DIVISION
Vermont Unit Docket No. 101-6-09 Vtec
Docket No. 102-6-09 Vtec
Docket No. 6-1-11 Vtec
ANR v Ken Bacon and Ken Bacon Jr. (Washington);
ANR v Bacon d/b/a Bacon Timber Harvest (Hyde Park); and
ANR v Ken Bacon and Ken Bacon Jr. (Barton).
ENTRY REGARDING MOTION
Title: Motion for Relief from Stipulation (Motion 7)
Filer: Ken Bacon and Ken Bacon Jr.
Attorney: Jason J. Sawyer
Filed Date: June 1, 2015
Response in Opposition filed 06/16/15 by Attorney John Zaikowski for Petitioner Vermont
Agency of Natural Resources
The motion is DENIED.
Pending before the Court is Ken Bacon’s and Ken Bacon, Jr.’s (“the Bacons”) motion for
relief from the Stipulated Agreement approved by this Court’s Order dated January 14, 2013
(“Agreement”). That Agreement resolved the Agency of Natural Resources’s (“ANR”) Petition
for Order to Show Cause, which was prompted by the Bacons’ failure to comply with
Administrative Orders (“AO”) in three matters arising from violations occurring at logging jobs
in Washington, Hyde Park, and Barton, Vermont. In the Agreement, the Bacons agreed to pay
the total accrued penalty of $40,763 in twelve quarterly installments of $3,396.92 over a three
year period; enroll in the Logger Education to Advance Professionalism Program (“LEAP”); and
notify ANR’s Department of Forests, Parks, and Recreation (“FPR”) in writing no fewer than five
days prior to the commencement of any logging operation in Vermont for a three year period
from the date of the Court’s Order.
On March 23, 2015, ANR filed a second Petition for Order to Show Cause in all three
matters for violations of the Agreement arising from the Bacons’ failure to pay the agreed-upon
penalties and to notify FPR of six logging operations the Bacons conducted. The Bacons now
request relief from the Agreement pursuant to Rule 60(b)(6) of the Vermont Rules of Civil
Procedure (“V.R.C.P.”). They argue for the liberal application of the Rule 60(b)(6) to grant relief
from the Agreement, which they allege they entered into under duress and without a complete
ANR v Bacon and Bacon, Jr., Nos. 101-6-09 Vtec, 102-6-09 Vtec, and 6-1-11 Vtec (EO on PJ Mot. For relief) p. 2
understanding of the terms. They also contend that the terms of the Agreement amount to an
abuse of ANR’s enforcement powers and that ANR should be equitably estopped from imposing
any fines arising from the Bacons’ failure to provide written notification.
Rule 60(b)(6) allows the trial court to relieve a party from a final judgment for any
reason other than those set forth in the other sections of the Rule, upon such terms as are just
and as long as the request for relief is made within a reasonable time. V.R.C.P. 60(b). Although
the grounds for relief are broadly stated and the Rule must be interpreted liberally to prevent
hardship or injustice, “interests of finality necessarily limit when relief is available.” Riehle v.
Tudhope, 171 Vt. 626, 627 (2000) (citing Tudhope v. Riehle, 167 Vt. 174, 178 (1997)); see also
Sandgate School Dist. v. Cate, 2005 VT 88, ¶ 7, 178 Vt. 625 (mem.) (quoting Estate of Emilo v.
St. Pierre, 146 Vt. 421, 423–24 (1985)). For this reason, motions for relief must “be made
within a reasonable time,” and the court has discretion in determining whether the delay was
reasonable. Greenmoss Builders, Inc. v. Dun & Bradstreet, Inc., 149 Vt. 365, 368–69 (1988)
(quoting V.R.C.P. 60(b)). Only extraordinary circumstances will justify a party’s failure to seek
more timely relief, and it is the moving party’s burden to make a showing of “extraordinary
circumstances” that countervail the interests of finality. See Riehle, 171 Vt. at 630; McCleery v.
Wally’s World, Inc., 2007 VT 140, ¶¶ 10–11, 183 Vt. 549.
The Bacons’ motion comes nearly two-and-a-half years after the Court signed the
consented-to Agreement and Order on January 14, 2013. They now suggest that their motion
was made within a reasonable time from the date in March 2015 when they became aware of
ANR’s intention to seek enforcement of the Agreement’s provision. This is not, however, the
time frame envisioned by the Rule. The “reasonable time” in which Rule 60(b)(6) motions must
be made begins to run on the date of the judgment being challenged, not from any subsequent
date of enforcement.
The Bacons argue that the penalty imposed is unconscionable and that they were under
duress in agreeing to it, and these are extraordinary circumstances countervailing the interests
of finality. First, the Bacons suggest that ANR exceeded the normal boundaries of negotiation
by imposing fines that it should have known the Bacons could never hope to pay. They also
suggest that they signed the Agreement “[w]ith the threat of jail time hanging over their heads,
and their attorney basically telling them, ‘just sign this,’” and that “they were led to believe that
the [Agreement] was the only way out of their problems . . . .” (Bacons’ Motion for Relief at 2,
filed June 1, 2015). We conclude that the twenty-six months that elapsed since the judgment
date and the Bacons’ motion for relief far exceeds a reasonable time period
The fines they accepted as a term of the Agreement are equal to the total accrued
penalty already imposed by this Court after merits hearings in Docket Nos. 101-6-09 Vtec and
102-6-09 Vtec and as a result of the AO in Docket No. 6-1-11 Vtec. The Bacons did not appeal
this Court’s merits decisions. ANR did not inflate the penalty and instead granted the Bacons
three additional years in which to pay the fine in quarterly payments of $3,396.92, which
amounts to just over $1,000 per month. We cannot find it unconscionable to impose a fine
already owed and to allow the respondent a timeframe within which to pay it. Furthermore,
although the Vermont Supreme Court has applied Rule 60(b)(6) to judgments with
unconscionable terms, “apart from considerations of finality, requests for such relief must be
ANR v Bacon and Bacon, Jr., Nos. 101-6-09 Vtec, 102-6-09 Vtec, and 6-1-11 Vtec (EO on PJ Mot. For relief) p. 3
sparingly granted because of our assumption that an agreement reached by the parties is
preferable to one imposed by the courts.” Riehle, 171 Vt. at 627. The Court therefore
concludes that the fine imposed is not unconscionable.
As to their second argument, we note that the Bacons accepted the terms of the
Agreement to avoid contempt proceedings resulting from their failure to comply with this
Court’s January 2010 Decision and Judgment Order in Docket Nos. 101-6-09 and 102-6-09 Vtec
and January 2011 Judicial Order in Docket No. 6-1-11 Vtec. Contempt proceedings by law
include the possibility of incarceration, and the Bacons cannot now claim that the possibility of
jail time invalidates the Agreement. See 12 V.S.A. § 121-23; Kellner v. Kellner, 2005 VT 1, ¶ 13,
176 Vt. 571 (concluding that where a stipulation was a calculated tactical decision to avoid
contempt proceedings, it was not entered into under duress). After facing contempt charges
for failing to comply with this Court’s Order, the Bacons made a tactical decision: they chose to
withdraw their objections, sign the Agreement, and pay their fines in installments over several
years in order to avoid a more onerous penalty. The Bacons cannot now rely on Rule 60(b)(6)
to “substitute for a timely appeal or [provide relief from an ill-advised tactical decision or from
some other free, calculated, and deliberate choice of action.” Riehle, 171 Vt. at 627 (citing
Richwagen v. Richwagen, 153 Vt. 1, 3–4 (1989); Greenmoss Builders, Inc., 149 Vt. at 368). We
cannot, therefore, conclude that the Agreement is invalidated by duress.
In addition to the unconscionable advantage argument, the Bacons argue that ANR
should be equitably estopped from imposing any fines arising out of the Bacons’ failure to
provide written notice to FPR because it was aware of the Bacons’ logging operations for a
year-and-a-half before it told the Bacons that failure to provide written notice was a violation of
the Agreement. The Bacons argue that by allowing them to take jobs without requiring written
notice, ANR allowed the Bacons to take action to their detriment and created a good faith belief
that actual notice would be sufficient. For the reasons stated below, we conclude that this
argument is misplaced.
“The doctrine of equitable estoppel precludes a party from asserting rights which
otherwise may have existed as against another party who has in good faith changed his position
in reliance upon earlier representations.” In re Lyon, 2005 VT 63, ¶ 16, 178 Vt. 232 (quoting My
Sister’s Place v. City of Burlington, 139 Vt. 602, 609 (1981)) (internal quotation marks omitted).
It is “based upon the grounds of public policy, fair dealing, good faith, and justice, and its
purpose is to forbid one to speak against his own act, representations or commitments to the
injury of one to whom they were directed and who reasonably relied thereon.” Id. (quotations
omitted). Estoppel should be applied to the government only with great caution. Id. (citing In
re McDonald's Corp., 146 Vt. 380, 383 (1985) (quotations omitted)); My Sister’s Place, 139 Vt. at
609 (citations omitted); see also Lakeside Equip. Corp. v. Town of Chester, 2004 VT 84, ¶ 8, 177
Vt. 619 (mem.) (noting that equitable estoppel against a government entity should be applied
“‘only in rare instances’ when the elements of estoppel are met and the injustice that would
result from denying estoppel outweighs the negative impact on public policy that would result
from applying the doctrine” (quoting Larkin v. City of Burlington, 172 Vt. 566, 569 (2001)
(mem.)).
ANR v Bacon and Bacon, Jr., Nos. 101-6-09 Vtec, 102-6-09 Vtec, and 6-1-11 Vtec (EO on PJ Mot. For relief) p. 4
In addition to this specialized fifth element pertaining to equitable estoppel claims
against governmental entities, a party invoking the doctrine of equitable estoppel has the
burden of establishing each of its four constituent elements: (1) the party to be estopped must
know the facts; (2) the party being estopped must intend that his conduct shall be acted upon
or the acts must be such that the party asserting the estoppel has a right to believe it is so
intended; (3) the latter must be ignorant of the true facts; and (4) the party asserting the
estoppel must rely on the conduct of the party to be estopped to his detriment. See Lyon, 2005
VT 63, ¶ 17 (citing Wesco, Inc. v. City of Montpelier, 169 Vt. 520, 524 (1999)).
We hold that the Bacons have not established the required elements of estoppel and
have not met their burden for estopping ANR. Regarding the first element, the Bacons have not
established that ANR knew the relevant facts. The Bacons allege that they conducted their
logging business under the “nearly constant supervision by [ANR] employees,” and that ANR
“had actual knowledge of essentially every job the Bacons worked because [ANR] employees
were always there.” (Bacons’ Motion for Relief at 2). The Bacons argue that each of the six
jobs that took place between September 2013 and March 2015 went forward with ANR’s
knowledge, that ANR therefore knew the relevant facts.
ANR acknowledges that it became aware of these unreported operations at various
times during that period, but only after the Bacons had commenced these logging jobs. (ANR’s
Opposition at 6, filed June 15, 2015). The Bacons have failed to establish that ANR was fully
aware of or condoned their unreported logging operations before they commenced. It is not
ANR’s responsibility to remain apprised of the Bacons’ pending logging operations and to
remind them of their duty to inform FPR in writing prior to commencement. It was the Bacons’
duty to inform the FPR before commencing operations, and they cannot now argue that ANR is
estopped from imposing fines for their failure to do so. The doctrine of equitable estoppel
cannot be invoked in favor of one whose own omissions or inadvertences contributed to the
problem. Town of Bennington v. Hanson-Walbridge Funeral Home, Inc., 139 Vt. 288, 294
(1981) (citations omitted).
The Bacons have also failed to satisfy the second element. The Bacons have offered no
facts to support a finding that ANR intended them to rely on ANR’s conduct, or that the Bacons
could reasonably believe that ANR intended to induce reliance. In fact, the Bacons concede
that ANR “never made any representations that [the Bacons’] actions were acceptable or in
compliance with the [Agreement].” (Bacons’ Motion for Relief at 2). The notice requirement is
the latest in a series of Court Orders requiring the Bacons to notify FPR of upcoming logging
operations in writing no fewer than five days prior to commencement. In fact, the requirement
arose from the Bacons’ failure to comply with this Court’s January 2010 Decision and Judgment
Order in Docket Nos. 101-6-09 and 102-6-09 Vtec and January 2011 Judicial Order in Docket No.
6-1-11 Vtec. The March 2015 Petition for Order to Show Cause marks ANR’s second attempt to
impose the terms of the various Orders spanning as far back as 2010. The Bacons cannot now
argue that ANR intended for them to rely on ANR’s failure to immediately initiate the current
proceedings.
As to the third element, the Bacons have failed to establish that they were ignorant of
the true facts. The Bacons themselves admit that they were aware of the notice requirement
ANR v Bacon and Bacon, Jr., Nos. 101-6-09 Vtec, 102-6-09 Vtec, and 6-1-11 Vtec (EO on PJ Mot. For relief) p. 5
but that it “seemed like an exercise in futility.” (Bacons’ Motion at 2). Despite this admission,
the Bacons failed to notify either ANR or the Court of their inability to comprehend or comply
with the notice requirement until the present motion, filed more than five years after the initial
Decision in the matter. Further, as indicated above, the Agreement was signed in response to
the Bacons’ failure to comply with the notice requirements in the Court’s January 2010 Decision
and Judgment Order. The Bacons accepted the terms of the Agreement to avoid contempt
proceedings, and were thus aware of the notice requirements and the consequences of their
failure to comply.
Finally, the Bacons have failed to establish that they relied on ANR’s failure to impose
the notice requirement to their detriment. The Bacons were aware of the consequences of
their failure to provide adequate notice per the terms of the Agreement, yet chose to forgo
notice. They have failed to establish that ANR was actually aware of any logging operations
prior to commencement, making it unclear to this Court how the Bacons could now argue that
ANR acquiesced to their failure to provide notice. As stated above, we will not predicate an
estoppel in favor of a party whose own omissions contributed to the problem. Town of
Bennington, 139 Vt. at 294. The Bacons have thus failed to satisfy the fourth element of
estoppel.
Accordingly, the Bacons have failed to show that they are entitled to relief under Rule
60(b)(6); their motion for relief is therefore DENIED.
Electronically signed on September 15, 2015 at Burlington, Vermont, pursuant to V.R.E.F. 7(d).
________________________________
Thomas S. Durkin, Judge
Environmental Division
Notifications:
John Zaikowski (ERN 4276), Attorney for Petitioner Vermont Agency of Natural Resources
Jason J. Sawyer (ERN 4192), Attorney for Respondent Ken Bacon and Ken Bacon, Jr.
cstanton