-1- 

 

STATE OF VERMONT 

SUPERIOR COURT ENVIRONMENTAL DIVISION

Environmental Division Unit Docket No. 154-12-15 Vtec

Old Lantern Non-Conforming Use 

Decision on Post-Trial Sanctions Motion 

This matter was the subject of a trial that was recounted in a Merits Decision issued on 

April 2, 2018. After the trial, but before this Court issued its Merits Decision, Appellee Old Lantern 

Barn, together with its owners, Lisa and Roland Gaujac (hereinafter collectively referred to as 

“Old Lantern”) filed a motion for monetary sanctions against Appellants Alison and Adrian 

Wolverton (“Appellants”) and their attorney, James A. Dumont, Esq., for what Old Lantern asserts 

was an “abuse of the judicial process.” Appellants and their attorney strongly object to the 

sanctions request. Both Old Lantern and Appellants, joined by their attorney, have filed 

supplemental memoranda in support of and in opposition to the sanctions request. The Town of 

Charlotte (“Town”) and Interested Persons Michael Frost, Karen Frost, Maura Wygmans, and 

Justin Wygmans have chosen to not engage in this post-trial sanctions dispute. 

Discussion 

We begin our analysis with a review of the case law concerning what constitutes abuse of 

judicial process and whether a trial court has the authority to sanction a party and their attorney 

for such abuse. 

A “trial court has inherent authority under the law of this state to award monetary 

sanctions against a litigant or attorney who abuses the judicial process.” Provident Funding 

Associates, L.P. v. Campney, 2017 VT 120 ¶ 18, citing Van Eps v. Johnston, 150 Vt. 324, 327 (1988). 

In Van Eps, our Supreme Court defined abuse of the judicial process to include “acting in bad 

faith, ignoring court orders, and scheduling delays causing prejudice to the opposing party.” Id. 

(citations omitted). 
-2- 

Provident Funding provides further guidance in the case at bar, even though it presented 

somewhat different procedural facts. In that case, a successor-in-interest to a first mortgagee 

and promissory note holder initiated multiple foreclosure actions after the mortgagor/ 

homeowner defaulted on the note. The trial court had dismissed three prior foreclosure actions 

on the same note and mortgage after the plaintiff failed to prosecute the actions, either by failing 

to properly serve a defendant or respond to notices from the court. When the plaintiff presented 

an identical foreclosure action for the fourth time, a junior mortgagee moved to have the action 

dismissed. The Court granted the junior mortgagee’s dismissal motion and, as a sanction for 

causing the junior mortgagee to incur the unnecessary expense of having to hire an attorney to 

respond and participate in the three prior identical foreclosure actions, which plaintiff then 

caused the court to dismiss, the trial court ordered that plaintiff would be precluded in the future 

from foreclosing the junior mortgagee’s interest in the subject property. Id at ¶ 8. 

On appeal, the Supreme Court affirmed the trial court’s determination that a sanction 

was warranted, but reversed the dismissal sanction and remanded the action for the trial court 

to consider monetary sanctions, specifically reimbursement of attorney’s fees, as an alternate 

sanction against plaintiff for its improper actions. Id. at ¶ 20. Thus, the Supreme Court 

established that ordering reimbursement of an innocent party’s attorney’s fees is an appropriate 

sanction against a party who is found guilty of abusing the judicial process. In so ruling, the Court 

cited to several of its prior decisions, including O'Rourke v. Lunde, 2014 VT 88, ¶ 33, 197 Vt. 360, 

104 A.3d 92 (explaining that an award of attorney's fees is permissible in “exceptional cases,” 

such as where party is forced to undergo multiple rounds of litigation (quotation omitted)); and 

Lamell Lumber Corp. v. Newstress Int'l, Inc., 2007 VT 83, ¶ 23, 182 Vt. 282, 938 A.2d 1215 

(affirming award of attorney's fees to plaintiff as monetary sanction for defendant's failure to 

appear at scheduled jury draw). While the case at bar presents a different set of procedural facts, 

we find these decisions helpful in analyzing Appellees’ motion for sanctions and Appellants’ 

objections. 

I. Did Appellants’ and their attorney’s actions constitute an abuse of the judicial process?

In the Merits Decision issued last week, we addressed the frustrations that were caused 

by Appellants and their attorney when they chose, on the first day of the scheduled trial, to not 
-3- 

participate in that trial. We have those frustrations in mind and incorporate them here by this 

reference. However, to determine whether and how Appellants and their attorney may have 

abused the judicial process, we must look back to the various filings and court decisions leading 

up to the de novo trial in this appeal. 

This appeal concerns an area of the law that is not wholly clear and can be complex. A 

challenge to the lawful use of a property that does not comply with the present zoning 

regulations can present multiple layers of factual and legal issues. This appeal was no exception, 

and the vigor with which the parties here litigated those legal and factual issues presented 

perfect examples of how complex the legal analysis of non-conforming uses can become. In 

particular, the Court wrestled for some time with the legal concept that an expansion of a nonconforming business use, absent a physical expansion of the property improvements, may not 

result in the targeted property losing its grandfathered status. See In re Old Lantern NonConforming Use Appeal, No. 154-12-15 Vtec, slip op. at 14–15 (Vt. Super. Ct. Envtl. Div. July 3, 

2017) (Durkin, J.). When the parties filed several reconsideration motions, we revisited the 

intensity and related issues in our Entry Orders issued on September 13, 2017, and November 

13, 2017. 

We continue to believe that the neighboring Appellants and Interested Persons held 

sincere concerns about the use of the Old Lantern Barn, its alleged increase in intensity, and 

whether their concerns could legitimately be raised in this appeal. We found no abuse of the 

judicial process in the way in which they pursued those concerns in this litigation. 

Our pre-trial rulings set the parameters of what legal and factual issues were within our 

jurisdiction in this appeal. We reviewed those determinations again as we prepared our Merits 

Decision and continue to believe those rulings reflect an accurate reading of the current case law. 

But we find no abuse committed in the manner in which Appellants and their attorney challenged 

the applicable case law precedent, or our interpretation of it. 

However, we do find fault and abuse in how Appellants’ addressed (or rather, failed to 

address) the issues that remained for trial. Our pre-trial rulings left four Questions from 

Appellants’ Statement of Questions as ripe for resolution at trial. These Questions memorialized 

Appellants’ long-running assertions that (1) the Old Lantern Barn had changed from offering 
-4- 

meals only prepared off-site, to offering meals prepared on-site; (2) the Old Lantern Barn had 

been changed or expanded to a restaurant, open to the general public; and (3) the Old Lantern 

Barn had ceased operations for six months, or more. If Appellants, assisted by their attorney, 

presented sufficient facts to support these long-standing accusations, they could have provided 

a factual foundation for a legal determination that the Old Lantern Barn should no longer be 

regarded as a lawful, pre-existing but non-conforming use. 

We never received Appellants’ presentation of facts that supported these claims. And we 

are left to assume by Appellants’ decision at the start of trial that they never had the facts to 

support these accusations. We are left to conclude that Appellants made these bold assertions 

throughout two to three years of administrative proceedings and litigation without ever having 

any facts to support these allegations. We are left to wonder whether Appellants, and perhaps 

their attorney, simply created these allegations from thin air, in their zeal to bring an end to Old 

Lantern’s business operations. 

Our fears were compounded by the manner in which Appellants revealed their lack of 

evidence. We recognize that the discovery process in any litigation can reveal many things, 

including the reliability of one’s own facts. But when it became apparent that Appellants had no 

factual foundation for the legal issues raised in the four Questions that remained for adjudication 

at trial, they and their attorney had ample time to confess that reality to opposing counsel and 

the Court. Instead, Appellants and their attorney caused Old Lantern, their attorney, and this 

Court to commit the time and resources to trial preparation. When all parties and their counsel 

appeared for the first day of trial, they and the Court understood that Appellants came prepared 

to present their evidence, at the appropriate time, and participate in the trial. Instead, 

Appellants, through their attorney, asked for confirmation of the Court’s pre-trial rulings, and 

then advised that they had decided not to participate in the trial. We continue to believe that 

Appellants’ and their attorney’s actions are the most egregious of any the undersigned has 

witnessed in thirty-three years of civil trial litigation. 

One more circumstance deserves mention. Appellants asserted a new legal theory at the 

beginning of trial, not previously disclosed to the Court: the notion that an ordinance existed, or 

once existed, that required Old Lantern to obtain a recreation or dance hall permit, that Old 
-5- 

Lantern had failed to receive such a permit, and that this omission justified vacating Old Lantern’s 

grandfathered status. Appellants’ little to no prior notice of this new legal theory for denying Old 

Lantern’s lawful non-conforming use left no time to verify whether such an ordinance ever 

existed, still exists, and whether Old Lantern had ever received such a permit. More to the point 

in this limited jurisdiction de novo appeal, Appellants and their attorney offered no legal rationale 

as to how the Court’s jurisdiction would allow such a claim to be entertained in this appeal. When 

the Court posed that query and made that ruling, Appellants and their attorney saw fit to give 

notice that they would therefore begin the process of submitting yet another complaint to the 

Town Zoning Administrator about the Old Lantern Barn’s lawful status. Appellants and their 

attorney suggested that their inability to raise this new issue in this appeal was an additional 

rationale for their decision to not participate in the trial. 

We appreciate, but find unconvincing the affidavit of Kevin Brown, Esq. offered by 

Appellants and their attorney as an explanation for their actions on the first day of trial. Mr. 

Brown never appeared in this proceeding. Respectfully, his affidavit appears to be drafted more 

as an advocacy document than as an objective assessment of the legal challenges presented in 

this litigation. 

Lastly, we note that Appellants’ attorney spent considerable time in his opposition 

memoranda relying upon the notion that in this proceeding, it is Old Lantern that carried the 

various burdens of proof. Some of what Appellants’ attorney represents is accurate, as to the 

burden of proof, but we are unconvinced that his legal theory justified his and his clients’ antics 

on the first day of trial. Burdens of proof often shift, even when the ultimate burden of 

persuasion returns to the originally-burdened party. But as an officer of this Court, Appellants 

attorney had a duty to inform opposing counsel and this Court, well in advance of trial, when he 

became aware that Appellants possessed no evidence, or were unprepared to present such 

evidence, that would support the claims that Appellants presented in their Statement of 

Questions. 

For all these reasons, we conclude that Appellants and their attorney committed an abuse 

of the judicial process when they failed to disclose their lack of any evidence to support their 

remaining claims, and failed to make such a disclosure, including up to the first day of trial. 
-6- 

II. What is the appropriate sanction? 

In light of our conclusions concerning the abuse of the judicial process that Appellants 

and their attorney committed, we turn to the question of whether to impose the sanction Old 

Lantern requests of reimbursement of their attorneys’ fees and expenses. Old Lantern also 

requests that the Court conduct a hearing to receive evidence and argument before making its 

ruling. We believe a hearing will be necessary to make an informed determination of the 

appropriate reimbursement level as a sanction and therefore GRANT that request. However, for 

the benefit of the parties, we provide the following guidance on the parameters of the evidence 

that the Court will entertain. 

We first note that Old Lantern appears to request that the Court entertain ordering 

Appellants and their attorney to reimburse a sum of $80,000.00 in attorneys’ fees, and it appears 

that Old Lantern represents that this sum is approximately the full amount of attorneys’ fees that 

Old Lantern incurred to the day of trial. Whether that is the total of legal fees incurred or not, 

we DECLINE to order a sanction of that scope. 

Our judiciary adheres to the “American Rule” concerning reimbursement of attorneys’ 

fees which provides that, absent a contractual or statutory provision to the contrary, all parties 

must bear their own costs of legal representation, even when they prevail in litigation. See 

Southwick v. City of Rutland, 2011 VT 105, ¶ 5, 190 Vt. 324 (“affirming that Vermont adheres to 

what is called the American Rule: parties must ‘bear their own attorneys' fees absent a statutory 

or contractual exception.’”), quoting DJ Painting, Inc. v. Baraw Enters., Inc., 172 Vt. 239, 246 

(2001). Thus, even when a party prevails in litigation in Vermont, such as Old Lantern did here, 

they must bear the cost of their own attorneys’ fees when they prevail, absent a contractual or 

statutory provision to the contrary. It is for this reason that we decline to entertain a request for 

attorneys’ fees incurred in the pre-trial preparations in this litigation, before Appellants and their 

attorney committed their abuse of the judicial process. 

We make reference to this general rule to clarify the focus of our future hearing: we are 

only considering the possible reimbursement of attorneys’ fees as a sanction against Appellants 

and their attorney for the abuse of the judicial process that they committed. Thus, our 

consideration here does not cause us to ignore the American Rule to which Vermont generally 
-7- 

adheres. Rather, we rely upon the equitable powers that this Court enjoys when considering an 

award of attorneys’ fees as a sanction “against a litigant or attorney who abuses the judicial 

process.” Provident Funding Associates, L.P. v. Campney, 2017 VT 120 ¶ 18 (citation omitted). 

CONCLUSION 

For all these reasons, we conclude that Appellants Alison and Adrian Wolverton 

(“Appellants”) and their attorney, James A. Dumont, Esq. abused the judicial process as detailed 

above and shall hold a hearing to receive evidence on a monetary penalty to be imposed upon 

Appellants and their attorney, and whether an award should be imposed individually or jointly 

and severally, consistent with the guidelines for such an award outlined above. 

A Notice of hearing accompanies this Decision. 

Electronically signed on April 13, 2018 at Newfane, Vermont, pursuant to V.R.E.F. 7(d). 

________________________________ 

Thomas S. Durkin, Superior Judge 

Environmental Division