Court Opinion

ID: 5127504
Source: CourtListenerOpinion
Date Created: 2021-11-19 15:09:43.354716+00
Date Added: 2024-06-11T08:23:00.620693
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
                               APPROVAL OF THE APPELLATE DIVISION
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                                                        SUPERIOR COURT OF NEW JERSEY
                                                        APPELLATE DIVISION
                                                        DOCKET NO. A-3977-19

CALLAREMI CADILLAC
BUICK GMC, INC.,

          Petitioner-Appellant,

v.

JERSEY CENTRAL POWER
AND LIGHT COMPANY,

     Respondent-Respondent.
__________________________

                   Submitted October 14, 2021 – Decided November 19, 2021

                   Before Judges Hoffman, Whipple and Geiger.

                   On appeal from the New Jersey Board of Public
                   Utilities, Docket No. EC19090999.

                   Noel E. Schablik, attorney for appellant.

                   Connell Foley, LLP, attorneys for respondent Jersey
                   Central Power and Light Company (Leo J. Hurley, Jr.,
                   of counsel and on the brief).

                   Andrew J. Bruck, Acting Attorney General, attorney for
                   respondent New Jersey Board of Public Utilities
                   (Sookie Bae-Park, Assistant Attorney General, of
            counsel; Terel L. Klein, Deputy Attorney General, on
            the brief).

PER CURIAM

      Petitioner Callaremi Cadillac Buick GMC, Inc. appeals from a final

decision of the Board of Public Utilities (the Board) adopting the initial decision

of the Administrative Law Judge (ALJ), denying petitioner's motion for

summary decision and granting respondent Jersey Central Power and Light

Company's cross-motion for summary decision.             Respondent incorrectly

calculated petitioner's electric usage by using an improper meter constant.

Respondent sought to make a retroactive billing adjustment to reflect the correct

meter constant.    Petitioner contested the billing adjustment.        The Board

concluded that petitioner "failed to bear its burden of proof . . . that it was

improperly billed" by respondent and dismissed its petition. We affirm.

                                        I.

      We ascertain the following facts from the record. Petitioner operates a

retail new car dealership on Route 46 in Mount Olive Township, Morris County.

Petitioner has been a non-residential electric service customer of respondent

since September 1974.

      From June 2009 through February 2019, electric usage at petitioner's

property was measured by electric meter S07018655 (the old meter).                In

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February 2019, the old meter was replaced with meter S322924098 (the new

meter) as part of a scheduled replacement. The new meter is the same type of

meter as the old meter.

      In an affidavit, Doug Meneeley, a distribution technician in respondent's

meter services department, explained that respondent calculates a customer's

electric usage by taking the usage registered by the meter during the billing

period and multiplying that number by the appropriate "meter constant" for that

type of meter. According to Meneeley,

            A meter constant is a number used in the calculation of
            a customer's usage in certain circumstances based on
            the configuration of the customer’s electric service. A
            meter constant is necessary when the amount of energy
            is too large to be registered on a meter display. . . . The
            meter constant for the current transformers remains the
            same regardless the specific electric service meter in
            use, so long as the type of meter is the same.

      Meneeley further explained that, to determine a customer's actual usage

for billing purposes, respondent must subtract the number displayed on the

customer's meter at the end of the billing period from the number displayed on

the customer's meter at the end of the prior billing period, and then multiply the

resulting number by the meter constant.

      The meter constant that respondent used to calculate petitioner's electric

usage since at least March 2013 was thirty. In February 2019, the electric meter

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at petitioner's property was audited pursuant to a meter work notification. The

audit revealed that the appropriate meter constant was actually forty. On March

6, 2019, a supervisor visited the property and verified that respondent had used

the wrong meter constant to calculate petitioner's electric bill since at least

March 2013.

      On March 25, 2019, respondent tested the old meter. The old meter tested

within the accuracy parameters required by the Board. The parties agree that

petitioner did not tamper with the old meter during the service period at issue.

      As a result of the incorrect meter constant that respondent used to

calculate petitioner's electric usage, petitioner had been under-billed for electric

service. On April 23, 2019, respondent informed petitioner that it would be re-

billing petitioner for electric service to recover some of the losses it incurred

from using the incorrect meter constant.

      On April 29, 2019, respondent sent petitioner an invoice containing a

billing adjustment, after applying the correct meter constant.           The total

adjustment was $33,467.65.       Including other adjustments and the account

balance prior to adjustment, petitioner's total account balance was $34,742.16. 1

1
  On September 19, 2019, respondent issued a revised invoice in the amount of
$38,256.70. The revised amount reflected the amounts owed for electric service

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      Thereafter, petitioner filed a verified petition against respondent,

challenging the legality of respondent's billing adjustment. On October 7, 2019,

respondent filed a verified answer, asserting that Section 3.06 of its tariff

authorized it to make the retroactive billing adjustment.         In its reply to

respondent's verified answer, petitioner asserted that respondent is barred from

making the billing adjustment under N.J.A.C. 14:3-4.6(d). On October 23, 2019,

the Board transmitted the matter to the Office of Administrative Law as a

contested case.

      The parties then filed cross-motions for summary decision. On March 5,

2020, an ALJ denied petitioner's motion for summary decision and granted

respondent's cross-motion for summary decision.         The ALJ concluded that

N.J.A.C. 14:3-4.6(d) does not govern this case because the meter did not fail to

register 100 percent of service.     Rather, respondent "simply undercharged

[petitioner] because [respondent] applied the wrong meter constant, that is,

[respondent] applied a meter constant of [thirty] instead of a meter constant of

[forty] in the billing calculation, for which it seeks a billing adjustment." The

provided by three different third-party suppliers that provided electric service to
petitioner during the six-year re-bill period. The bill included the following
amounts: $4,397.62 for services provided by JCP&L; $12,421.40 for services
provided by Hudson Energy Services; and $21,437.68 for services provided by
Direct Energy Business, LLC.
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ALJ concluded that, under Section 3.06 of respondent's Tariff for Service,

respondent is authorized to make the billing adjustment under Section 3.06's

"any other legitimate reason" clause, which allows re-billing for adjustments

dating back up to six years.

      On May 20, 2020, the Board adopted the ALJ's initial decision as its final

agency decision. The Board concluded that N.J.A.C. 14:3-4.6(d) does not

govern this case because "[t]his is not a case where a meter has been found to

be registering less than 100 percent of service." The Board determined that

"[t]he billing discrepancy was caused not by a faulty meter, but by multiplying

the meter's measurement by an incorrect meter constant." The Board accepted

the ALJ's determination that the "any other legitimate reason" clause in Section

3.06 of respondent's tariff applies in this case and authorizes the billing

adjustment. The Board therefore adopted the ALJ's initial decision as its final

decision and dismissed petitioner's case. This appeal followed.

                                       II.

      Our review of an agency's final administrative determination is limited.

In re Carter, 191 N.J. 474, 482 (2007). Such determinations are not overturned

"in the absence of a showing that it was arbitrary, capricious or unreasonable,

or that it lacked fair support in the evidence." Ibid. (quoting Campbell v. Dep't

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of Civ. Serv., 39 N.J. 556, 562 (1963)).          In reviewing an agency's final

determination, we review:

             (1) whether the agency's action violates express or
             implied legislative policies, that is, did the agency
             follow the law; (2) whether the record contains
             substantial evidence to support the findings on which
             the agency based its action; and (3) whether in applying
             the legislative policies to the facts, the agency clearly
             erred in reaching a conclusion that could not reasonably
             have been made on a showing of the relevant factors.

             [Mazza v. Bd. of Trs., 143 N.J. 22, 25 (1995) (citation
             omitted).]

      An appellate court is "in no way bound by the agency's interpretation of a

statute or its determination of a strictly legal issue." Mayflower Sec. Co. v.

Bureau of Sec., 64 N.J. 85, 93 (1973). However, "[a]n administrative agency's

interpretation of a statute it is charged with enforcing is entitled to great weight."

In re Saddle River, 71 N.J. 14, 24 (1976) (citation omitted). Moreover, we give

great deference to an agency's "interpretation and implementation of its rules

enforcing the statutes for which it is responsible." In re Freshwater Wetlands

Prot. Act Rules, 180 N.J. 478, 489 (2004). "Where an agency's expertise is a

factor, a court defers to that expertise, particularly in cases involving technical

matters within the agency's special competence." In re Adoption of Amends. to

Ne., Upper Raritan, Sussex Cty., 435 N.J. Super. 571, 583 (App. Div. 2014).

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      Petitioner contends that N.J.A.C. 14:3-4.6(d) forbids respondent from

retroactively adjusting petitioner's charges for electric service. Petitioner argues

that the meter "registered less than 100 percent of the service provided" because

the meter constant is a component of the meter, which, if not correctly

calibrated, can skew the meter reading. Petitioner further contends that the

purpose of the regulation is to "shield[] the customer from retroactive re -billing

where the customer did nothing to contribute to the billing error."

      Respondent argues that N.J.A.C. 14:3-4.6(d) does not apply because the

meter did not register less than 100 percent of the service provided. Respondent

notes that the meter was tested and found to be "garnering accurate readings

within the required accuracy parameters set by the Board." Respondent further

notes that the meter constant "has nothing to do with the meter's functionality."

Rather, it is a number used to calculate electric usage in the billing process.

      N.J.A.C. 14:3-4.6(d) provides:

            (d) If a meter is found to be registering less than 100
                percent of the service provided, the utility shall not
                adjust the charges retrospectively or require the
                customer to repay the amount undercharged,
                except if:

                   1.   The meter was tampered with, or other theft
                        of the utility service has been proven;

                   2.   The meter failed to register at all; or

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                   3.   The circumstances are such that the
                        customer should reasonably have known that
                        the bill did not reflect the actual usage.

                   [N.J.A.C. 14:3-4.6(d).]

      The traditional rules of statutory interpretation apply when interpreting a

regulation. See J.H. v. R & M Tagliareni, LLC, 239 N.J. 198, 214 (2019). "[A]

regulation should be construed in accordance with the plain meaning of its

language and in a manner that makes sense when read in the context of the entire

regulation." Ibid. (quoting Medford Convalescent & Nursing Ctr. v. Div. of

Med. Assistance & Health Servs., 218 N.J. Super. 1, 5 (App. Div. 1985)).

      In interpreting a statute, the court first looks to the language of the statute.

State v. Butler, 89 N.J. 220, 226 (1982). "If the statute is clear and unambiguous

on its face and admits of only one interpretation, we need delve no deeper than

the act's literal terms to divine the Legislature's intent." Ibid. The court does

not add terms which may have been intentionally omitted by the legislature, nor

does the court "speculate or otherwise engage in an interpretation which would

avoid [the statute's] plain meaning." Sterling Laurel Realty, LLC v. Laurel

Gardens Co-Op, Inc., 444 N.J. Super. 470, 476 (App. Div. 2016).

      The plain language of N.J.A.C. 14:3-4.6(d) reveals that it applies where

"a meter is found to be registering less than 100 percent of the service provided

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                                          9
. . . ." Here, the meter was not inaccurate. The meter measured all service

respondent provided. Respondent merely used the incorrect meter constant in

calculating petitioner's electric bill, resulting in the under-billing at issue.

      We next consider whether the Board erred in concluding that respondent

Section 3.06 permitted respondent to make the billing adjustment. Respondent

contends that Section 3.06 is broader than N.J.A.C. 14:3-4.6(d) because it allows

a billing adjustment brought "for any other legitimate reason" instead of

requiring an inaccurate meter. We agree.

      Prior to offering utility services to the public, each public utility must

submit a tariff to the Board for approval. N.J.A.C. 14:3-1.3(a); see also N.J.A.C.

48:2-21. "A tariff is a published schedule of rates, filed by a public utility, and

thereafter, in the absence of successful challenge, applicable equally to all

customers." Saddle River, 71 N.J. at 29. "[A] tariff is not a mere contract. It is

the law, and its provisions are binding on a customer whether he knows of them

or not." Ibid.

      Section 3.06 of respondent's tariff provides:

             Billing Adjustments: An adjustment of charges due to
             the Company for Services provided by the Company
             will be made when a meter fails to register within the
             limits of accuracy prescribed by the [Board of Public
             Utilities] in accordance with [N.J.A.C.] 14:3-4.6, or for
             any other legitimate reason, in which case such

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            adjustment shall not be for a period of more than six
            years prior to the time the reason of the adjustment
            became known to the Company.

      Here, the ALJ and the Board both found that respondent sought to make

the billing adjustment for a legitimate reason – to apply the correct meter

constant.   The Board promulgated subchapter four to ensure that "metered

customers will pay for what they receive and utilities will be compensated for

what they provide." 28 N.J.R. 1810(a) (April 1, 1996). Bearing in mind the

deference given to the Board's "interpretation and implementation of its rules

enforcing the statutes for which it is responsible," Freshwater Wetlands, 180

N.J. at 489, we conclude the Board reasonably found that Section 3.06 allowed

respondent to make the challenged billing adjustment.

      Affirmed.

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