My father was coming home from a lunch meeting last Friday when he noticed a little steam coming from under the hood in the vicinity of the expansion tank. He immediatley pulled over, and had the car towed to a local Euro sports garage. The diagnosis was a stuck t-stat, which forced the coolant out of the expansion tank through the valve in the cap. The engine was still full of coolant, so (hopefully) no lasting damage was done to the new engine I had put in last year. The t-stat was less then three months old, and of course was an OEM piece. There was no damage done to the (new) hoses, and the t-stat was replaced, but I was wondering if there was anything else that should be looked at? Thanks :)

Did replacing the theromstat cure the problem? Is any coolant disappearing or being consumed?

Is the engine now holding a steady temperature once warmed up? On my 850 the temp gauge will not move from 3 o'clock unless I am pulling up a miles-long hill on a hot day with a full load and the a/c running. Similar on other cars with adequate cooling systems.

If the temp is not holding steady - for instance if the engine runs somewhat warmer (not necessarily too hot) under heavy load:

It could be a partly obstructed radiator.

I have heard stories of water pumps (on non-Volvos) which are weak (due to a damaged or slipping impeller) which would also lead to marginal cooling. But I have never seen this personally to verify if it could happen.

Though unlikely, an air pocket could exist in the cooling system, impeding good circulation.

Finally, is the pressure cap itself perfect?

The engine is in fact holding a steady temperature when it is warm. The water pump was replaced last Fall when the new engine was installed. The expansion tank cap is no more than three months old. The coolant level has remained steady since the new t-stat was installed on Monday. The radiator was replaced in the summer of 2004. Thanks for the help :)

With all that you've described, I'd say you are good to go! :>0
You're dad is to be commended for taking quick action and having the car towed instead of taking any chances with it. Once it starts to overheat and the needle goes into the red, it is often too late. Give him a pat on the back and a beer from me! LOL
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1998 S70 T5 Emarald Green Metallic, 2004 V70 2.5T Ruby Red, Previous Owner of Black '94 850 Turbo Wagon. My cars have been running so well lately they've got me worried.

Thanks MadeinJapan! All I need to do now is figure out why the defroster isn't working, and I am good to go :) Maybe this weekend I can finally spend some time working on my VW :) Have an absolutely splendid weekend one and all!

Could be a dampner motor in the A/C vents that isn't working properly. Thus, the vent doesn't close up that is normally open and which forces the air straight out to through the air vents on the dash (pointing at you and the passenger(s). When this happens, the air isn't forced up to the windshield. I hear this is sort of a PITA if that's the issue, as you have to take the dash out to get to it, but it isn't impossible to fix. When you switch to defrost (turn radio, etc. off so you can hear), you should hear a slight hum of a motor changing the direction of the dampner in the vents. If you don't here this or you hear clicking (stuck) then I would be willing to bet that this is your issue. Good luck and let us know what's up.
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1998 S70 T5 Emarald Green Metallic, 2004 V70 2.5T Ruby Red, Previous Owner of Black '94 850 Turbo Wagon. My cars have been running so well lately they've got me worried.

I just spoke with my father, and he confirmed that he heard the motor changing the direction of the dampner in the vents while turning on the defroster. I also confirmed with him that the A/C was indeed kicking out cold air. Also, the expansion tank is full of coolant(after my father drove some 200 miles today), so I am close to certain that there are no leaks. The search continues :) Have a good evening MadeinJapan :)

Thanks once again MadeinJapan :) I will follow your instructions, and get back to the board by tomorrow evening. Take care :)

MadeinJapan: Someone on Swedespeed mentioned swapping out the cabin filter when there were defrosting issues, so yesterday I did exactly that, and it appears so far(knock on wood)to be doing the trick. My father's cabin was last replaced some 30k ago, and was longing for a replacement :) Thanks again for all the help!

Ah...simple "repairs" such as changing out a filter are always preferred over expensive, difficult ones! :)
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1998 S70 T5 Emarald Green Metallic, 2004 V70 2.5T Ruby Red, Previous Owner of Black '94 850 Turbo Wagon. My cars have been running so well lately they've got me worried.

Thanks MadeinJapan :)