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IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA
 

January 2013 Term FILED ____________ 

January 24, 2013 

No. 12-1023 released at 3:00 p.m. 

RORY L. PERRY II, CLERK ____________ SUPREME COURT OF APPEALS 

OF WEST VIRGINIA 

LARRY V. FAIRCLOTH REALTY, INC.,
 

a corporation, and
 

LARRY V. FAIRCLOTH,
 

Plaintiffs Below, Petitioners
 

v. 

THE PUBLIC SERVICE COMMISSION OF WEST VIRGINIA,
 

BERKELEY COUNTY PUBLIC SERVICE SEWER DISTRICT,
 

a public corporation, and
 

BERKELEY COUNTY PUBLIC SERVICE DISTRICT, d/b/a
 

BERKELEY COUNTY PUBLIC SERVICE WATER DISTRICT
 

Defendants Below, Respondents
 

Appeal from the Public Service Commission of West Virginia
 

PSC Case No. 09-0961-PSWD-GI
 

AFFIRMED
 

Submitted: January 16, 2013 

Filed: January 24, 2013 

Laura V. Faircloth, Esq. Richard E. Hitt, Esq. 

Martinsburg, West Virginia Charleston, West Virginia 

Attorney for Petitioners Attorney for Respondent 

The Public Service Commission 

of West Virginia 

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William F. Rohrbaugh, Esq. Mark E. Kauffelt, Esq. 

Martinsburg, West Virginia Kauffelt & Kauffelt 

Attorney for Respondent Charleston, West Virginia 

Berkeley County Public Service Hoy G. Shingleton, Jr., Esq. 

Sewer District Martinsburg, West Virginia 

Attorneys for Respondent 

Berkeley County Public 

Service Water District 

The Opinion of the Court was delivered PER CURIAM. 
 

 

 

 

 

 

 

 

SYLLABUS 

“Judicial estoppel bars a party from re-litigating an issue when: (1) the party 

assumed a position on the issue that is clearly inconsistent with a position taken in a previous 

case, or with a position taken earlier in the same case; (2) the positions were taken in 

proceedings involving the same adverse party; (3) the party taking the inconsistent positions 

received some benefit from his/her original position; and (4) the original position misled the 

adverse party so that allowing the estopped partyto change his/her position would injuriously 

affect the adverse party and the integrity of the judicial process.” Syllabus Point 2, West 

Virginia Dept. of Transp., Div. of Highways v. Robertson, 217 W.Va. 497, 618 S.E.2d 506, 

(2005). 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Curiam: 

This is an appeal by Petitioners Larry V. Faircloth, individually, and Larry V. 

Faircloth Realty, Inc. (“Faircloth”), from a May 9, 2012, order of the Public Service 

Commission (“PSC”). In that order, the PSC ruled that the Respondents, Berkeley County 

Public Service Sewer District (“Sewer District”) and Berkeley County Public Service Water 

District (“Water District”), no longer satisfied the criteria for charging capacityimprovement 

fees that Faircloth had challenged. Due to this finding, Faircloth is no longer required to pay 

the previously implemented capacity improvement fees. After entry of this order, the Water 

and Sewer Districts filed petitions for reconsideration with the PSC. Faircloth filed two 

motions in opposition to these petitions for reconsideration. The PSC agreed with Faircloth 

and denied the petitions for reconsideration. 

Faircloth obtained the relief it sought on the central issue before the PSC – the 

elimination of the capacity improvement fees. Thereafter, the PSC agreed with Faircloth and 

denied the Water and Sewer Districts’ petitions for reconsideration. Nevertheless, Faircloth 

filed the present appeal of the PSC’s May 9, 2012, order.1 

1

Faircloth argues that the PSC erred by: (1) concluding that it had the jurisdiction and 

authority to establish a capacity improvement fee; (2) concluding that a capacity 

improvement fee constitutes a charge, rather than a tax; (3) failing to recognize that the Local 

Powers Act, W.Va. Code § 7-20-1, authorizes the imposition of “impact fees” only if the 

county in which the public service district is established has implemented a comprehensive 

(continued...) 

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After considering all matters of record, we affirm the PSC’s May 9, 2012, 

order. 

I. Factual and Procedural Background 

In 2004, the Berkeley County Water District and Sewer District filed requests 

with the PSC to charge capacity improvement fees (“CIFs”) due to rapid population growth 

in Berkeley County that was projected to overload the capacity of existing water and sewer 

plants. The CIF was a one-time fee charged to developers2 in Berkeley County. The PSC 

states that a CIF charge represents the future cost to a utility of developing capacity to meet 

growth in customer demand. A CIF is meant to offset the cost a utility will be required to 

incur, and its existing customers must pay, to expand and construct the capacity to meet and 

serve the new demand in an area experiencing rapid growth.3 

1

(...continued) 

zoning ordinance; (4) failing to recognize that the Community Infrastructure Investment 

Project Act, W.Va. Code § 22-28-1, makes the assessment of a CIF unnecessary when a 

builder constructs its own improvements; and (5) even assuming that it had the statutory 

authority to establish a capacity improvement fee, the PSC arbitrarily and capriciously 

identified May 9, 2012, as the date that the Water and Sewer Districts ceased to meet the 

criteria necessary to support a capacity improvement fee. 

2

In its order approving the Water District’s CIF, the PSC defined the term developers 

as “a person, corporation, or entity who is in the business of land and/or commercial or 

housing development, for profit, or a person, corporation, or entity who requests an alternate 

main line extension that includes the installation of mains by the person, corporation or 

entity.” 

3

The PSC described the need for CIFs as follows: 

(continued...) 

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Following public hearings and argument, the PSC approved the requested 

Berkeley County CIFs. The PSC determined that the rapid population growth could create 

a crisis and that “absent additional treatment capacity, capacity at the four existing sewer 

treatment facilities would be exhausted in five years.” In its order approving the Sewer 

District’s CIF, the PSC stated: 

The CIF will facilitate responsible infrastructure planning 

and sewage capacity increases. Responsible planning and 

financing of additional sewage treatment capacity is appropriate 

for an area experiencing the explosive growth that Berkeley 

County has, and expects to continue to experience. We find, 

therefore, that approval of the CIF . . . is consistent with our 

obligations pursuant to W.Va. Code § 24-1-1, in that the CIF is 

fair, encourages the well-planned development of utility 

resources, is just, reasonable, and will be applied without unjust 

discrimination or preference. The formula by which the CIF 

fees were calculated, based on a Georgia Tech model, is 

reasonable and appropriate, and we conclude that the CIFs are 

based primarily on the costs to maintain necessary capacity in 

order to serve new customers. 

3

(...continued) 

CIFs were developed for a specific purpose: rapid 

population growth in portions of West Virginia was projected to 

overload the capacity of existing water and sewer plants long 

before originally expected and long before those plants reached 

the end of their operational useful lives. CIFs provided a 

temporary means of accumulating at least part of the funds 

necessary to expand capacity, thus reducing the rate impact on 

all customers. 

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Faircloth filed a complaint against the Sewer and Water Districts on February 

27, 2009, requesting that the PSC rescind the CIFs4 “until the economic, factual basis upon 

which they were created returns and further hearings are had to determine that any CIF 

sought by (the Districts) is reasonable, just and void of any sort of discrimination against 

developers and builders[.]” In response to Faircloth’s complaint, the PSC initiated a general 

investigation into the CIFs charged by the Water and Sewer Districts. The PSC made 

Faircloth a party to this general investigation, explaining that: 

(Faircloth) raised questions that help define the scope of 

the review of the CIFs. (Faircloth), however, is at a 

disadvantage when it comes to investigating and presenting 

evidence regarding the need for the CIFs, the proper amount of 

the CIFs, and the allowable uses of the CIFs. The interconnected 

skills and disciplines required of this type of investigation – 

economics, projecting population and utility usage growth, 

projecting costs of utility plant construction, and law – would 

tax the resources of any individual complainant. 

The PSC proceeded with this general investigation, held evidentiary hearings 

in which Faircloth and the Water and Sewer Districts participated, and established a briefing 

schedule for the parties. In October 2009, one week before the initial round of briefs from 

the Water and Sewer Districts were due before the PSC, Faircloth filed a declaratory 

4

The PSC approved a $1,623.00 water CIF in August 2005. This amount was 

increased to $3,120.00 in August 2007. Similarly, the PSC approved a $1,581 sewer CIF in 

March 2005. This amount was increased to $3,650.00 in October 2006. The PSC placed a 

number of controls on these CIFs, requiring that the CIF funds be placed in separate accounts 

and that the funds be used only for upgrades or construction of water or sewer treatment 

facilities. 

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judgment action in the Circuit Court of Berkeley County, seeking the same remedy it sought 

from the PSC: relief from paying the CIFs. 

On January 29, 2010, the circuit court entered a declaratory judgment order 

finding that its exercise of jurisdiction was proper and ruling in favor of Faircloth on the 

substantive issues. The circuit court found that the PSC lacked jurisdiction to establish the 

CIFs.5 The Water and Sewer Districts appealed the circuit court’s ruling to this Court.6 On 

February 24, 2011, this Court issued a memorandum decision finding that Faircloth had 

failed to exhaust its administrative remedies before the PSC. This Court determined that the 

circuit court did not have jurisdiction in the matter and reversed the circuit court’s declaratory 

judgment order. 

Upon being returned to the PSC, Faircloth sought an expedited ruling from the 

PSC and a temporary injunction to enjoin the imposition and collection of CIFs until a final 

decision was made.7 After the PSC denied Faircloth’s motion for a temporary injunction, 

5

The circuit court granted a stay of its declaratory judgment order pending appeal and 

ordered the PSC to deposit all CIFs collected during the stay into a separate escrow account. 

6

This Court permitted the PSC to intervene in the appeal of the circuit court’s order. 

7

Faircloth filed a July 8, 2011, motion requesting an expedited ruling in this matter. 

On July 19, 2011, the PSC issued an order noting that the population growth data in the case 

was over 18 months old and directing the parties to provide the PSC with updated population 

growth information. After the parties filed motions with these updated population growth 

statistics, the PSC issued an order on September 30, 2011, which noted that the parties did 

not agree on population and customer growth data. The PSC therefore set the matter for an 

evidentiary hearing and required the parties to submit direct and rebuttal testimony on this 

issue. 

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Faircloth sought a writ of mandamus from this Court to compel the PSC to enter a final order 

in its general investigation and to stay the collection of CIFs until the PSC entered its final 

order. By order entered on November 10, 2011, this Court refused Faircloth’s requested writ 

of mandamus and refused the request for a stay. 

In December 2011, the PSC heard testimony regarding the continuing need for 

CIFs. After hearing this testimony and considering briefs filed by both Faircloth and the 

Water and Sewer Districts, the PSC issued a May 9, 2012, final order (“May final order”) 

discontinuing the CIFs. The PSC’s order explained that: 

CIFs are intended to address only rapid and unexpected 

capacity depletion that can be traced to extreme growth levels 

from new customers. Absent the compelling circumstances of 

(i) rapid and continued population growth, and (ii) a near-term 

exhaustion of system-wide capacity, CIFs are not warranted. To 

that end the Commission (PSC) created criteria to determine 

whether it was appropriate to charge a CIF. The recent 

economic downturn has slowed growth, and the Districts are no 

longer in immediate danger of exhausting the capacity of their 

respective treatment plants. Because the Districts no longer 

meet the criteria that were set by the Commission (PSC) and 

accepted by the District, it is appropriate to discontinue those 

fees.8 

8

The PSC determined that it had the statutory authority and jurisdiction to establish 

CIFs when extraordinary population growth (2% per year or 20% over ten years) had 

occurred and when identifiable exhaustion of existing water supply or sewage treatment 

capacity was demonstrated. The PSC determined that the Water and Sewer Districts could 

not satisfy this criteria because they failed to show that their existing capacity would be 

depleted within seven years or less. 

We note that the PSC possesses broad statutory authority. The PSC’s 

considerable powers concerning the regulation and control of public utilities can be found 

in W.Va. Code § 24-1-1(a) [1989], which states, in relevant part: 

(continued...) 

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After the PSC issued this order discontinuing the CIFs, the Water and Sewer 

Districts filed petitions for reconsideration with the PSC. Faircloth filed two motions in 

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(...continued) 

(a) It is the purpose and policy of the Legislature in 

enacting this chapter to confer upon the public service 

commission of this state the authority and duty to enforce and 

regulate the practices, services and rate of public utilities in 

order to: 

(1) Ensure fair and prompt regulation of public utilities 

in the interest of the using and consuming public; [and] . . . 

(4) Ensure that rates and charges for utility services are 

just, reasonable, applied without unjust discrimination or 

preference[.] 

Similarly, W.Va. Code § 24-1-1(b) provides, in relevant part: 

(b) The public service commission is charged with the 

responsibility for appraising and balancing the interests of 

current and future utility service customers, the general interests 

of the state’s economy and the interests of the utilities subject to 

its jurisdiction in its deliberations and decisions. 

The Legislature has repeatedly stated that the PSC has the power to regulate 

utility rates, charges, and tariffs. For instance, W.Va. Code § 24-2-2(a) [1998] states that the 

PSC “may change any intrastate rate, charge or toll which is unjust or unreasonable[.]” 

Likewise W.Va. Code § 24-2-3 [1983] states, in relevant part, that the PSC: 

[S]hall have power to enforce, originate, establish, change and 

promulgate tariffs, rates, joint rates, tolls and schedules for all 

public utilities. . . . And whenever the commission shall, after 

hearing, find any existing rates, tolls, tariffs, joint rates or 

schedules unjust, unreasonable, insufficient or unjustly 

discriminatory or otherwise in violation of any of the provisions 

of this chapter, the commission shall by an order fix reasonable, 

rates, joint rates, tariffs, tolls or schedules to be followed in the 

future[.] 

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opposition to these petitions for reconsideration, asking the PSC to deny the petitions to 

reconsider the May final order. The PSC agreed with Faircloth and denied the Water and 

Sewer Districts’ petitions for reconsideration on August 7, 2012 (“reconsideration order”). 

This order directed the Water and Sewer Districts to return any CIFs collected subsequent 

to the entry of the May final order. 

On September 6, 2012, Faircloth appealed the PSC’s May final order to this 

Court. 

II. Standard of Review 

This Court has previously addressed the standard of review of an order entered 

by the PSC. In Syllabus Point 2 of Monongahela Power Co. v. Public Serv. Comm’n of West 

Virginia, 166 W.Va. 423, 276 S.E.2d 179 (1981), this Court stated: 

In reviewing a Public Service Commission order, we will 

first determine whether the Commission’s order, viewed in light 

of the relevant facts and of the Commission’s broad regulatory 

duties, abused or exceeded its authority. We will examine the 

manner in which the Commission has employed the methods of 

regulation which it has itself selected, and must decide whether 

each of the order’s essential elements is supported by substantial 

evidence. Finally, we will determine whether the order may 

reasonably be expected to maintain financial integrity, attract 

necessary capital, and fairly compensate investors for the risks 

they have assumed, and yet provide appropriate protection to the 

relevant public interests, both existing and foreseeable. The 

court’s responsibility is not to supplant the Commission’s 

balance of these interests with one more nearly to its liking, but 

instead to assure itself that the Commission has given reasoned 

consideration to each of the pertinent factors. 

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This Court summarized the above formula in Syllabus Point 1 of Central West 

Virginia Refuse, Inc. v. Public Serv. Comm’n of West Virginia, 190 W.Va. 416, 438 S.E.2d 

596 (1993), explaining, 

The detailed standard for our review of an order of the 

Public Service Commission . . . may be summarized as follows: 

(1) whether the Commission exceeded its statutory jurisdiction 

and powers; (2) whether there is adequate evidence to support 

the Commission’s findings; and, (3) whether the substantive 

result of the Commission’s order is proper. 

This Court has also stated that 

[A]n order of the public service commission based upon its 

findings of facts will not be disturbed unless such finding is 

contrary to the evidence, or is without evidence to support it, or 

is arbitrary, or results from a misapplication of legal principles. 

Syllabus Point 5, in part, Boggs v. Public Serv. Comm’n, 154 W.Va. 146, 174 S.E.2d 331 

(1970) (internal citation omitted). 

III. Analysis 

Faircloth has asserted inconsistent positions regarding the PSC’s May final 

order – first requesting that the PSC deny the petitions for reconsideration and enforce that 

order, then appealing the order to this Court asking that it be reversed. Our law is clear that 

Faircloth is judicially estopped from challenging the May final order. 

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This Court addressed judicial estoppel in Syllabus Point 2 of West Virginia 

Dept. of Transp., Div. of Highways v. Robertson, 217 W.Va. 497, 618 S.E.2d 506 (2005), 

stating: 

Judicial estoppel bars a party from re-litigating an issue 

when: (1) the party assumed a position on the issue that is 

clearly inconsistent with a position taken in a previous case, or 

with a position taken earlier in the same case; (2) the positions 

were taken in proceedings involving the same adverse party; (3) 

the party taking the inconsistent positions received some benefit 

from his/her original position; and (4) the original position 

misled the adverse party so that allowing the estopped party to 

change his/her position would injuriously affect the adverse 

party and the integrity of the judicial process. 

We have invoked judicial estoppel, sua sponte, based on our consideration of 

three factors. First, it is generally recognized that “a court, even an appellate court, may raise 

[judicial] estoppel on its own motion in an appropriate case.” Matter of Cassidey, 892 F.2d 

637, 641 (7th Cir. 1990). See also Franklin D. Cleckley, Robin J. Davis & Louis J. Palmer, 

Litigation Handbook on West Virginia Rules of Civil Procedure § 8(c) (Supp. 2012) 

(“[J]udicial estoppel is an equitable doctrine invoked by a court at its discretion.”). Second, 

where inconsistent conduct is taken that “is barred by . . . judicial estoppel, there are no 

triable issues of fact as a matter of law.” Whitacre P’ship v. Biosignia, Inc., 358 N.C. 1, 39, 

591 S.E.2d 870, 895 (2004). Third, the record presented in this appeal is sufficient for this 

Court to determine the application of the doctrine. 

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The doctrine of judicial estoppel is important in maintaining the integrityof our 

judicial system. We noted in West Virginia Dept. of Transp., Div. of Highways v. Robertson, 

217 W.Va. at 504, 618 S.E.2d at 513, that: 

The doctrine of “[j]udicial estoppel is a common law 

principle which precludes a party from asserting a position in a 

legal proceeding inconsistent with a position taken by that party 

in the same or a prior litigation.” In re C.Z.B., 151 S.W.3d 627, 

633 (Tex.Ct.App. 2004). Under the doctrine, a party is 

“generally prevent[ed] ... from prevailing in one phase of a case 

on an argument and then relying on a contradictory argument to 

prevail in another phase.” Pegram v. Herdrich, 530 U.S. 211, 

227 n. 8 (2000). This Court recognized long ago that “[t]here 

are limits beyond which a party may not shift his position in the 

course of litigation[.]” Watkins v. Norfolk & Western Ry. Co., 

125 W.Va. 159, 163, 23 S.E.2d 621, 623 (1942). Thus, “[w]here 

a party assumes a certain position in a legal proceeding, and 

succeeds in maintaining that position, he may not thereafter, 

simply because his interests have changed, assume a contrary 

position, especially if it be to the prejudice of the party who has 

acquiesced in the position formerly taken by him.” Hubbard v. 

State Farm Indem. Co., 213 W.Va. 542, 552 n. 21, 584 S.E.2d 

176, 186 n. 21 (2003). 

(Internal citations omitted). 

Applying the four Robertson factors to the present case, we find that the first 

factor is met because Faircloth requested that the PSC deny the Water and Sewer Districts’ 

petitions for reconsideration, and thus affirm its May final order. After the PSC granted the 

relief Faircloth requested, Faircloth filed the present appeal, requesting that the May final 

order be reversed. These two positions are plainly inconsistent. Faircloth’s motions in 

opposition to the petitions for reconsideration did not contain any of the arguments raised in 

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this appeal. Nor did Faircloth file its own petition for reconsideration asking the PSC to 

affirm the portion of the order it agreed with, and to reverse the portion of the May final 

order that it subsequently challenged in this appeal. Instead, Faircloth adamantly argued that 

the petitions for reconsideration be denied and urged the PSC to enforce its May final order 

without any reservation.9 

The second and third Robertson factors are also met. The second factor is met 

because Faircloth’s inconsistent positions were taken in proceedings involving the same 

parties. The third factor is met because Faircloth received a benefit by prevailing in its 

motion to deny the petitions for reconsideration: it was no longer required to pay the CIFs 

that it had challenged. Additionally, the PSC ordered the Water and Sewer Districts to 

refund any CIFs they had collected since the May final order was entered. 

9

In its motions opposing the petitions for reconsideration, Faircloth argued that the 

May final order divested the PSC of jurisdiction over the case and argued that it did not have 

the authorityto consider the petitions for reconsideration. In making this argument, Faircloth 

observed that the May final order held that “on entry of this Order this case shall be removed 

from the Commission docket of open cases.” 

Faircloth also argued that W.Va. Code § 24-5-1 “provides the sole method of review 

of a final order of the Commission (PSC).” W.Va. Code § 24-5-1 states, in relevant part, that 

“[a]ny party feeling aggrieved by the entry of a final order by the commission, affecting him 

or it, may present a petition in writing to the supreme court of appeals, or to a judge thereof 

in vacation, within thirty days after the entry of such order, praying for the suspension of 

such final order.” Thus under Faircloth’s reasoning before the PSC, a party’s only remedy 

following a final order of the PSC is to file an appeal with this Court within thirty days. 

Faircloth chose not to appeal any of the relief granted in the May final order to this Court 

within thirty days. Instead, Faircloth forcefully argued that the case was over and that the 

May final order should be enforced. 

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Finally, we find that allowing Faircloth to maintain inconsistent positions on 

the May final order would affect the integrity of the judicial process. Faircloth obtained the 

relief it sought on the central issue before the PSC. It successfully opposed the petitions for 

reconsideration filed by the adverse parties. Faircloth then requested that this Court reverse 

the PSC’s May final order so that it could obtain additional relief. To permit Faircloth to 

take inconsistent positions in this case “impedes rather than promotes, the truth-seeking 

function of the judiciary and thereby hinders public confidence in the integrity of the judicial 

process.” Robertson, 217 W.Va. at 507, 618 S.E.2d at 516 (internal citation omitted). See 

also Helfand v. Gerson, 105 F.3d 530, 535 (9th Cir. 1997) (“The integrity of the judicial 

process is threatened when a litigant is permitted to gain an advantage by the manipulative 

assertion of inconsistent positions, factual or legal.”). 

Having applied the facts of this case to the elements of our judicial estoppel 

test, we conclude that Faircloth is judicially estopped from challenging the errors it alleges 

are contained in the PSC’s May final order. 

IV. Conclusion 

The PSC’s May 9, 2012, order is affirmed. 

Affirmed. 

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