System and method for controlling operation of a vehicle having a fluid reservoir. The system includes one or more fluid level indicators configured to respectively obtain a measured fluid level in the fluid reservoir. A plurality of sensors is operatively connected to the vehicle and configured to respectively obtain one or more parameters. A controller is configured to determine if a fluid level transition between the measured fluid level and a past fluid level is indicated, when there is exactly one fluid level indicator. The controller is configured to identify a reporting state from among a first state, a second state and a third state, based in part on a correlation to a dynamic event and an expected direction for the fluid level transition. A control action is executed by the controller based in part on the reporting state.