Court Opinion

ID: 4536612
Source: CourtListenerOpinion
Date Created: 2020-05-26 19:22:14.85618+00
Date Added: 2024-06-11T08:48:56.437978
License: Public Domain

STATE OF WEST VIRGINIA
                            SUPREME COURT OF APPEALS

City of Kenova, West Virginia
Petitioner                                                                     FILED
                                                                             May 26, 2020
vs)    No. 19-0919 (PSC Case No. 18-1232-S-C)                                  released at 3:00 p.m.
                                                                           EDYTHE NASH GAISER, CLERK
                                                                           SUPREME COURT OF APPEALS
                                                                                OF WEST VIRGINIA
The Public Service Commission of West Virginia,
Respondent

                               MEMORANDUM DECISION

       Petitioner City of Kenova (City)1 appeals the September 6, 2019 order of the Public
Service Commission of West Virginia (Commission)2 requiring the City to make a leak
adjustment credit in the amount of $233.12 to a sewer account following the discovery of
a hidden commode leak.

       Upon consideration of the standard of review, the parties’ briefs, oral arguments and
the record on appeal, the Court finds no substantial question of law or prejudicial error.
For these reasons, a memorandum decision affirming the Commission’s decision is
appropriate under Rule 21 of the Rules of Appellate Procedure.

       In August 2018, Rebecca Florczak received a high water bill totaling $424.55.3
After receiving the bill, Ms. Florczak’s daughter began investigating and immediately
realized that a commode in Ms. Florczak’s master bathroom was leaking. They fixed the
leak by adjusting the chain to the flapper valve. Although Ms. Florczak slept in the master
bedroom adjacent to the master bath during the timeframe that the commode leaked, she
had never entered the master bathroom because it had been used exclusively by her recently
deceased husband.4 And the master bathroom door was not directly adjacent to the master

       1
           The City of Kenova is represented by counsel, F. Paul Calamita, Esq.

       2
        The Commission is represented by staff attorney, John R. Auville, Esq., and
general counsel, Jessica M. Lane., Esq.
       3
        Ms. Florczak’s water usage was typically around 3,000 gallons per month. The
sewer bill at issue reflected water usage of 19,200 gallons that month.

       4
        Ms. Florczak testified before the Administrative Law Judge (ALJ) that her husband
died after being in the hospital from June 12, 2018 to June 27, 2018. Prior to his death,
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bedroom. So, although Ms. Florczak slept in the master bedroom, she did not hear the
water running in the bathroom.

       After discovering the leaking commode, Ms. Florczak requested a leak adjustment
from the City. City officials informed her that the Commission’s rule prohibits granting a
leak adjustment. So, Ms. Florczak was required to pay the full amount due in order to
maintain her water service. But, she filed a formal complaint with the Commission on
August 31, 2018. The City filed an answer seeking to dismiss her complaint, arguing that
because the high bills were a result of a leaking commode, Ms. Florczak did not qualify for
a leak adjustment under Water Rule 4.4.c.1, which provides that “leaking commodes . . .
shall not constitute leaks which entitle the customer to a recalculated bill.” Following an
investigation by the Commission Staff, it filed its Final Memorandum on November 29,
2018 recommending that Ms. Florczak receive a leak adjustment credit in the amount of
$233.12 because the high bills were most likely caused by a leaking commode that was not
obvious or detectable to Ms. Florczak, as that area of her residence was closed off due to
the husband’s cancer treatment and death.

       Following an evidentiary hearing on December 21, 2018, the Administrative Law
Judge (ALJ) entered a recommended decision on February 6, 2019 dismissing the case.5
The ALJ found that Water Rule 4.4.c.1 is unambiguous and prohibits the City from
granting an adjustment for a commode leak. On February 26, 2019, Ms. Florczak filed
exceptions to the recommended decision, asking the Commission to reverse the ALJ’s
decision and grant her a leak adjustment. Ms. Florczak argued that the City was just as
responsible as she was, if not more so, for failing to detect the leak because the City has a
radio read meter system with capability to send an alert on a high meter read, but the City
did not activate the alert system. And, she argued that there are exceptions to every rule

Mr. Florczak used a treatment called BCG, a medication injected into the bladder to destroy
cancer cells. Every time he flushed the commode, he had to add a chemical solution to the
commode to dilute the chemicals’ toxicity. So, due to the nature of these treatments, the
bathroom was off-limits to guests before Mr. Florczak’s death. In the month following his
death, Ms. Florczak did not go into the bathroom because it had not yet been sterilized to
make it safe to use. She routinely used the guest bathroom instead, storing all of her
toiletries there.

       5
         In addition to the testimony provided by Ms. Florczak and her daughter at this
hearing, the ALJ also heard evidence from a City meter utility technician who testified that
although the City had a special radio read system that alerts for a high meter read in order
to notify customers of a potential leak prior to issuing a bill, it did not activate the alert
system. A technical analyst from the Commission’s Engineering Division also provided
testimony regarding other cases where leak adjustments had been made in instances where
a complainant had a hearing problem or other physical difficulty making it difficult for the
leak to be visible or audible to the complainant.
                                              2
and the Commission had approved a leak adjustment for a customer who could not access
the upper level of the home. She reiterated that she did not hear the leak.

       The Commission Staff filed a response to Ms. Florczak’s exceptions disagreeing
with the ALJ’s recommended decision, noting that the Commission often engages in a
review of the circumstances of a leak, even if a commode is the cause.6 The Staff argued
that the Commission should grant the exceptions filed by Ms. Florczak because she had
good reason for restricting access to the master bathroom, and the layout of the house made
hearing the leak difficult because the master bathroom door was not directly adjacent to
the master bedroom. On September 6, 2019, the Commission entered a final order
determining that the unique facts of this case supported granting a leak adjustment because
the leak was hidden or otherwise undetectable to Ms. Florczak. The City then filed this
appeal.

        The issue before this Court is whether leak adjustments are expressly prohibited
under Water Rule 4.4.c.1. The City contends that in addition to the clear language of the
rule stating that “leaking commodes . . . shall not constitute leaks which entitle the customer
to a recalculated bill,” the Commission had also explained during the adoption of the rule
that, “we . . . believe that the rule should not apply to leaky commodes, dishwashers or
other appliances. We have attempted to place an exclusion to this rule to prevent
adjustments in those circumstances. The adjustment is intended to be applied for major
leaks such as pipes which break.”7 The City cites two PSC cases involving unoccupied
houses, arguing that the Commission did not engage in a discoverability analysis in those
cases.8 The City asserts that in this case, the Commission’s leak adjustment amounts to a
“revised rule through interpretation.”

        Conversely, the Commission asserts that it did not change the leak adjustment rule
in this case. It argues that Water Rule 4.4.c.1 does not contain an absolute prohibition to
leak adjustments, and since adoption of this rule, the Commission has engaged in a case-
by-case analysis to determine whether specific facts and circumstances warrant
adjustments. The Leak Adjustment Rule provides:

       6
           The City did not file a response.

      In re Revised Rules and Regulations for Water Util., Gen. Ord. No. 188.12, 1995
       7
WL 735601 at *4 (W. Va. P.S.C. Oct. 11, 1995) (Emphasis added).

       8
        See Currence v. Elkins Mun. Water Dep’t, No. 03-0004-W-C, 2003 W.Va. PUC
LEXIS 1533 (W. Va. P.S.C. April 9, 2003)(finding leaks associated with a toilet in a vacant
house are not entitled to a leak adjustment); Sabo v. Morgantown Util. Bd., No. 02-0367-
WS-C, 2002 WL 35458289 (W. Va. P.S.C. June 14, 2002)(finding leaks from a toilet are
not qualified for leak adjustments even though the resident was deceased).

                                               3
                  Each utility shall develop and implement a written policy
                  concerning the adjustment of customer bills where the bill
                  reflects unusual usage which can be attributable to leakage on
                  the customer’s side of the meter. Leaking commodes, dripping
                  faucets, malfunctioning appliances and similar situations shall
                  not constitute leaks which entitle the customer to a recalculated
                  bill. The policy shall be maintained in the utility’s office for
                  inspection by the public and shall be applied in a non-
                  discriminatory manner to all customers. The reasonableness
                  of the utility’s policy or practice with respect to a policy shall
                  be subject to Commission review in a formal complaint
                  proceeding.[9]

       The Commission promulgated the Leak Adjustment Rule in its current form in
     10
1995.     The Commission notes that it discussed utility opposition to customer leak
adjustments in its 1995 order, specifically, “[s]everal parties generally opposed mandatory
leak adjustments. They believe that the adjustments send the wrong message to customers
regarding maintaining their lines. We continue to believe leak adjustments are
reasonable.”11 In the same order, the Commission noted utilities’ requests that the
Commission limit leak adjustments to underground leaks only, and purposefully exclude
leaking commodes and faucets.12 The Commission contends that it refused to limit leak
adjustments to underground leaks, and instead incorporated the rule language relied on by
Petitioner to disallow leaks that are obvious to the customer.

       The Commission asserts that the Leak Adjustment Rule includes two ways to
evaluate leaks for eligibility for an adjustment. First, the use of the word “entitle” signals
to water utilities and their customers that customers are not automatically entitled to an
adjustment for leaks caused by leaking commodes, dripping faucets, or malfunctioning

       9
           Water Rule 4.4.c.1 (Emphasis added).

      In re Revised Rules and Regulations for Water Util., Gen. Ord. No. 188.12, 1995
       10
WL 735601.

        G.O. 188.12 at 3 (Emphasis added). The Commission explains that shortly after
       11

issuing G.O. 188.12, the Commission finalized corresponding Sewer Rules through
General Orders 188.12 In the Matter of Revised Rules and Regulations for Water Utilities
and General Order 186.8 In the Matter of Revised Rules and Regulations for Sewer Utilities
November 3, 1995.

       12
Id. at 4.

                                                  4
appliances. Second, the Leak Adjustment Rule provides that the Commission will review
in a formal complaint proceeding the reasonableness of a utility’s leak adjustment policy
and its application to the circumstances of a particular leak. Because an endless number
of scenarios can lead to a customer leak, the Commission maintains that it provided
guidance as to what a leak adjustment policy should look like, while reserving its authority
to review individual fact patterns.

       The Commission argues that in subsequent orders applying the language of Water
Rule 4.4.c.1, it affirmed that the rule does not prohibit a leak adjustment for a leaking
commode, dripping faucet, or malfunctioning appliance. It contends that it has also
consistently engaged in an individual review of the circumstances in each case, citing to
several where it held that leaks may qualify for an adjustment if the leak was hidden, or
not obvious or detectable, to the customer.13

       The Commission asserts that in McDowell v. Jefferson Utilities Inc. and Jefferson
County Pub. Serv. Dist.14, a case involving a leak originating from a faulty spigot at a non-
detectable location at the rear of a residence, it described its application of the leak
adjustment rule as follows:

                       [T]he underlying policy behind the rules is that the
                customer, not the utilities, should be responsible for costs
                related to leaks on the customers’ side of the meter that are
                obvious to the customer, and, thus are easily repaired by the
                customer and preventable through routine maintenance. As the
                Commission has recognized, “[o]ne purpose of the applicable
                Water Rules and Sewer Rules is to deny leak adjustments in
                cases where the accrual of a large bill is due to the customer’s

       13
         See Collins v. Corp. of Shepherdstown, Case No. 01-1430-WS-C (Commission
Order, July 23, 2002)(leak not noticeable because it originated in broken pipe in wall and
water did not run into house); Solenberger v. Martinsburg Mun. Water and Sewer Dep’ts.,
Case No. 05-0645-WS-C (Recommended Decision, August 15, 2005, Final Commission
Order, September 7, 2005)(utility agreed to leak adjustment because leak due to faulty
bathtub faucet located in vacant house owned by customer); Mayfield, Inc. v. Berkeley
Cnty. Pub. Serv. Water Dist., Case No. 02-1416-PWD-C (Recommended Decision, June
5, 2003, Final Commission Order June 25, 2003)(leak in crawl space undetected for a
period of time); and Watkins v. City of Grafton, Case No. 97-1545-S-C (Commission
Order, February 11, 1998)(leak adjustment made to customer based on hardship waiver
under Water and Sewer Rules because the customer had hearing problems and difficulty
discerning the sound of running water).

       14
            Case No. 09-0769-W-PSD-C (Commission Final Order, January 11, 2011).

                                               5
                 own failure to notice an obvious leak (like a leaky toilet)”
                 Collins v. Corp. of Shepherdstown, Case No. 01-1430-WS-C
                 (Commission Order dated July 23, 2002) at p. 7.[15]

In the same decision, the Commission stated:

                        Applying the underlying policy of customer
                 responsibility for readily discernable leaks leads to the obvious
                 corollary that if the customer has a leaking toilet, dripping
                 faucet, malfunctioning appliance or similar situation that is not
                 obvious or detectable to the customer, a leak adjustment is
                 approvable under the rules.[16]

The Commission contends, and we agree, that a review of the cases cited by the City also
supports the Commission’s argument that Water Rule 4.4.c.1 does not absolutely prohibit
a billing adjustment for undetected water consumption relating to commodes and that the
circumstances of a leak matter.17

       When this Court reviews the Commission’s administrative orders, we have
explained that

                 “The detailed standard for our review of an order of the Public
                 Service Commission contained in Syllabus Point 2 of
                 Monongahela Power Co. v. Public Service Commission, 166
W. Va. 423, 276 S.E.2d 179 (1981), may be summarized as
                 follows: (1) whether the Commission exceeded its statutory
                 jurisdiction and powers; (2) whether there is adequate evidence

       15
Id. at 5.
       16
Id. See also Jenkins v. Berkeley Cty. Pub. Serv. Sewer Dist., Case No. 17-0663-
PSD-C (W. Va. P.S.C. Oct. 1, 2018)(reaffirming principles discussed in McDowell and
permitting bill adjustment for a hidden leak resulting from a malfunctioning water softener
valve).

        See Sabo v. Morgantown Util. Bd., No. 02-0367-WS-C, 2002 WL 35458289 at *2
       17

(W. Va. P.S.C. June 14, 2002) (“While [Commission Staff] generally agreed that a leaking
commode under most circumstances did not qualify for a leak adjustment, [Commission
Staff] would reserve final judgment until a field investigation was completed.”); see also
Currence v. Elkins Mun. Water Dep’t, No. 03-0004-W-C, 2003 W.Va. PUC LEXIS 1533
at *6 (W. Va. P.S.C. April 9, 2003) (ALJ dismissed the case after a “consideration of all of
the above,” after no objections were filed to the Staff’s recommendation of dismissal.).

                                                6
              to support the Commission’s findings; and, (3) whether the
              substantive result of the Commission’s order is proper.”[18]

Recognizing a deferential standard of review, this Court has also stated, “‘[t]he principle
is well established . . . that an order of the public service commission based upon its finding
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.’”19

       The Commission reviewed the City’s application of its leak adjustment policy to the
particular facts of this case in a manner consistent with its previous decisions and Water
Rule 4.4.c.1, and there was adequate evidence to justify a leak adjustment. The undisputed
testimony in the record shows that due to the nature of the cancer treatments of Ms.
Florczak’s late husband, the bathroom was strictly off-limits to guests before and after his
death. Ms. Florczak exclusively used the guest bathroom and did not hear the water
because the master bathroom door was not directly adjacent to the master bedroom. Under
this Court’s highly deferential standard of review, we find no reason to disturb the
Commission’s order.20 Because we find that the grant of the leak adjustment was proper,
the City’s request for attorney’s fees and costs is not warranted.21

        Syl. Pt. 2, Pool v. Greater Harrison Cty. Pub. Serv. Dist., 241 W. Va. 233, 821
       18
S.E.2d 14 (2018) (citing Syl. Pt. 1, Central W.Va. Refuse, Inc. v. Pub. Serv. Comm’n of
W.Va., 190 W. Va. 416, 438 S.E.2d 596 (1993)).

        Syl. Pt. 1, in part, Sierra Club v. Pub. Serv. Comm’n, 241 W. Va. 600, 827 S.E.2d
19

224 (2019) (citations omitted).
       20
         See W. Va. Citizens Action Group v. Pub. Serv. Comm’n, 233 W. Va. 327, 758
S.E.2d 254 (2014). It is also important to note that a leak adjustment does not adversely
impact the City or its other customers financially. In a case where a customer is awarded
a leak adjustment, the customer’s account is credited the amount of excess revenue billed,
net of the actual variable costs attributed to leaked water. In this manner, the utility is
reimbursed for the actual variable cost of the water it produced. So, with the payment of a
leak-adjusted bill, the City is made whole for the actual expenses incurred in producing the
additional water but does not receive revenues over and above those costs.
       21
         The City additionally lodged an objection below to the Commission’s web docket
practice to restrict certain cases from open access on the Commission website. However,
the ALJ overruled the objection. The City now raises a second issue asserting that the
Commission’s restricted web docket violates the Freedom of Information Act (FOIA), and
that because taxpayer dollars fund the Commission’s operations, the Commission should
not be able to profit from these electronic records by selling the records to Westlaw and
Lexis while limiting access for taxpayers. The City maintains that without access to the
                                              7
       For these reasons, we affirm the Commission’s September 6, 2019, order requiring
the City to make a leak adjustment credit in the amount of $233.12 to the sewer account of
Ms. Florczak.

                                                                                   Affirmed.

ISSUED: May 26, 2020

CONCURRED IN BY:

Chief Justice Tim Armstead
Justice Margaret L. Workman
Justice Elizabeth D. Walker
Justice Evan H. Jenkins
Justice John A. Hutchison

records, complainants and courts are at a disadvantage because only the Commission can
rely on the full history of decisions. We find this issue of no merit. As the Commission
correctly contends, FOIA does not require a public body to publish public documents on
the internet, but rather only requires a public body to provide non-protected information
upon request. See W. Va. Code § 29B-1-3 (2019). And, as represented by the Commission,
it has recently reviewed its website restriction practices and has decided to post un-redacted
versions, if possible, of Orders issued in customer billing complaints on or after October
23, 2019.

                                              8