“Adequate Findings Doctrine” in Petroleum-Cleanup Reimbursement Appeals:
Guidance from the Vermont Supreme Court in In re Cote/Maquam Shore Market (2025 VT 42)

1. Introduction

This commentary examines the Vermont Supreme Court’s decision in In re Cote/Maquam Shore Market, 2025 VT 42, an appeal arising from a landowner’s efforts to obtain further reimbursement from the state’s Petroleum Cleanup Fund (“PCF”) for costs associated with a historic gasoline-station site. The dispute revolved around whether hiring a licensed engineer and completing a list of ancillary “punch-list” items qualified for PCF reimbursement. The Environmental Division of the Superior Court affirmed most of the Agency of Natural Resources’ (“ANR”) denials, but the Supreme Court reversed and remanded, finding that the lower court failed to make the detailed, specific findings necessary to uphold ANR’s conclusions.

Although the matter was remanded rather than finally resolved, the Supreme Court articulated a significant procedural principle: trial courts engaged in de novo review of agency reimbursement decisions must make explicit, item-specific findings explaining why the agency’s interpretation is reasonable and how contested expenses fit within statutory and regulatory categories. This requirement—labelled here the “Adequate Findings Doctrine” for reimbursement appeals—will guide future environmental, administrative and land-use litigation in Vermont.

2. Summary of the Judgment

The Court (Eaton, J.) held that the Environmental Division’s order—insofar as it upheld ANR’s refusal to pay for a general-contractor/engineer and numerous punch-list items—contained insufficient findings of fact and inadequate legal analysis. Merely reciting ANR’s conclusions (“capital improvement,” “work complete,” “costs excessive”) did not satisfy Vermont Rule of Civil Procedure 52 or longstanding precedent requiring courts to articulate how they arrived at their decisions. The judgment:

• Reversed the Environmental Division’s partial affirmance of ANR.
• Remanded for additional, item-specific findings and legal conclusions consistent with the Supreme Court’s guidance.
• Left undisturbed the Environmental Division’s earlier order requiring reimbursement for electrical, concrete, and wastewater work, as ANR had not appealed those portions.

3. Detailed Analysis

3.1 Precedents Cited and Their Influence

1. In re ANR Permits in Lowell Mountain Wind Project, 2014 VT 50 – confirmed deference to ANR interpretations within its expertise; Environmental Division acknowledged but misapplied the deference by failing to test reasonableness with factual specificity.
2. In re Morrisville Hydroelectric Project Water Quality, 2019 VT 84 – placed burden on appellant to show abuse of discretion; Court reiterated but emphasised that meeting the burden requires the tribunal to create a factual record adequate for review.
3. In re N.E. Materials Group/Rock of Ages, 2019 VT 55 and In re Katzenbach A250 Permit, 2022 VT 42 – provided standard (clear error) for factual review; Court used them to frame its limited role yet underlined that findings must exist to apply the standard.
4. Huston, 2020 VT 46; Bonanno, 148 Vt. 248 (1987); Wells v. Village of Orleans, 132 Vt. 216 (1974); and New England Power v. Barnet, 134 Vt. 498 (1976) – classic Vermont cases on adequacy of findings; they furnished the doctrinal backbone for reversal.
5. In re Vermont Gas Systems, 2024 VT 19 – stressed that an agency’s application of its own rules must be consistent and transparent; cited to show why conclusory denials are insufficient.

3.2 Legal Reasoning

The Supreme Court’s reasoning unfolded in three layers:

1. Statutory & Regulatory Framework – 10 V.S.A. § 1941(b) authorises PCF disbursements “for the purpose of cleanup and restoration” and caps amounts. ANR’s PCF Procedures identify eligible vs. ineligible costs, including prohibitions on non-pre-approved work and “capital improvements.”
2. Standard of Review – Environmental Division sits de novo but still must give reasoned consideration to ANR’s expertise; Supreme Court reviews Division’s legal conclusions de novo and findings for clear error.
3. Findings Requirement – Citing a line of Vermont authority, the Court held that conclusions unsupported by explicit findings compel reversal. The Division:
   • Parroted ANR’s statements without explaining why they were reasonable.
   • Failed to define “capital improvement,” “related to cleanup,” or “reasonable cost.”
   • Made no item-by-item analysis despite each punch-list entry being “vastly dissimilar.”
   Without such analysis, appellate review would require speculation—impermissible under Wells and progeny.

3.3 Potential Impact on Future Cases

• Heightened Scrutiny of Agency Denials – ANR must now prepare fuller written justifications, anticipating judicial insistence on granular reasoning.
• Environmental Division Procedure – Judges cannot simply adopt agency rhetoric. De novo review requires independent, articulated findings, particularly where diverse site-restoration tasks are bundled.
• Funding Certainty for Landowners & Developers – Applicants will likely compile more robust records (detailed estimates, code-compliance rationales, itemised invoices) knowing that courts will examine “each line item.”
• Clarification of “Capital Improvement” vs. “Cleanup Expense” – Although the Court declined to fix a definition, its remand signals that a principled, fact-sensitive boundary must be drawn—likely influencing rule-making and future litigation across underground-storage-tank, brown-field, and hazardous-waste contexts.
• Procedural Precedent Beyond Environmental Law – The Adequate Findings Doctrine reiterates a universal requirement applicable in family, tax, zoning, and administrative appeals whenever a lower tribunal invokes conclusory labels without explanatory analysis.

4. Complex Concepts Simplified

Petroleum Cleanup Fund (PCF)

A state fund that reimburses property owners or operators for reasonable costs of investigating and cleaning up petroleum leaks, typically from underground storage tanks, when such costs are not covered by insurance.

Capital Improvement (in this context)

Upgrades or additions that increase a property’s value or utility (e.g., new structures, upgraded utilities) as opposed to merely restoring conditions damaged by contamination. The precise boundary—central in this case—remains for the Environmental Division to articulate on remand.

De novo Review

A fresh, independent examination of evidence and legal standards by the Environmental Division; prior agency conclusions are not binding, though agency expertise remains persuasive.

Findings of Fact vs. Conclusions of Law

“Findings” are the court’s determinations about what actually happened; “conclusions” apply legal rules to those facts. Findings must be sufficiently detailed to show the path from evidence to result.

Remand

When an appellate court sends a case back to a lower tribunal for additional proceedings consistent with its opinion (here, to craft adequate findings and potentially reconsider eligibility).

5. Conclusion

In re Cote/Maquam Shore Market does more than return a reimbursement dispute for further fact-finding; it crystallises a procedural imperative: courts reviewing environmental-cost claims must provide transparent, item-specific findings demonstrating how each expense aligns—or fails to align—with statutory and regulatory criteria. By insisting on this rigor, the Vermont Supreme Court bolsters accountability, enhances appellate efficiency, and signals to agencies and litigants alike that conclusory labels such as “capital improvement” or “unreasonable cost” will not withstand scrutiny without evidentiary and analytical support. The decision thus fortifies Vermont’s tradition of meticulous judicial reasoning while shaping the practical administration of the Petroleum Cleanup Fund and similar remedial programs.