[*1]
Matter of 2222 Mgt. Corp./ Katz Realty Mgt. v City of New York Dept. of Envtl. Protection
2004 NY Slip Op 51647(U)
Decided on December 15, 2004
Supreme Court, Kings County
Kramer, J.
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.


Decided on December 15, 2004
Supreme Court, Kings County


Application of 2222 MANAGEMENT CORP./ KATZ REALTY MANAGEMENT, Petitioner, For a Judgment Pursuant to CPLR Article 78

against

THE CITY OF NEW YORK DEPARTMENT OF ENVIRONMENTAL PROTECTION, NEW YORK CITY WATER BOARD and THE CITY OF NEW YORK, Respondents.



Application of K.P. REALTY, LLC, Petitioner, For a Judgment Pursuant to CPLR Article 78 -against- CITY OF NEW YORK DEPARTMENT OF ENVIRONMENTAL PROTECTION, NEW YORK CITY WATER BOARD and THE CITY OF NEW YORK, Respondents.

Application of 1773 E. 12th STREET, LLC, Petitioner, For a Judgment Pursuant to CPLR Article 78 -against-

against

THE CITY OF NEW YORK DEPARTMENT OF ENVIRONMENTAL PROTECTION, NEW YORK CITY WATER BOARD and THE CITY OF NEW YORK, Respondents.





23545/04



All petitioners were represented by John A. Cannistraci, Esq., 230 Park Ave., Suite 416, NY, NY 10169. All respondents were represented by Michael A. Cardozo, Corp. Counsel of the City of New York, 100 Church St., NY, NY 10007.

Herbert Kramer, J.

The old maxim "the law abhors a volunteer" was never so fittingly demonstrated as in these cases. Petitioners timely applied to the respondents for the installation of a water meter on their properties, being assured that this is all they needed to do to avoid surcharges. Petitioners waited patiently for respondents to install the meters and suffered the imposition of surcharges in the interim. Finally, petitioners decided to employ self help to avoid the imposition of further surcharges and retained their own plumbers to install the meters. Now respondents insist that petitioners, in choosing to install their own meters, lost the benefit of the first option, the timely request for the installation of a meter, and must suffer the financial consequences of their own alacrity in the form of surcharges posted to their accounts.

Petitioners seek an order setting aside the decisions of respondent New York City Water Board denying their requests to vacate these surcharges.[FN1] [*2]

In identically worded decisions, Mr. Tweedy, Executive Director of the Water Board, issued a final determination denying petitioners' requests to revoke the surcharges. His decision was premised upon the theory that petitioners had "two mutually exclusive options" and therefore, notwithstanding their timely request for meter installation, when they subsequently exercised the option to install their own meters using their own plumbers they voided their earlier election to have DEP install the meters. Since the self installed meters had to be in place by June 30, 2000, their installation was untimely and subjected them to a surcharge which would run until the meter was actually installed.

Discussion

The Water Board annually promulgates a Rate Schedule that establishes rates for water and wastewater usage. The Fiscal Year 2001 Rate Schedule authorized the DEP Commissioner to install or cause to be installed meters on all premises connected with the water system. It also provided for the imposition of a 100% surcharge under two circumstances: First, if the customer failed to install a meter or remote reading device the surcharge would be applied from July 1, 2000 until the installation. Second, if the customer refused to permit the installation, repair, replacement or inspection of either a meter, a remote reading device or a water consuming fixture a surcharge would be applied from the date of the first refusal until the date the installation, repair or inspection takes place. [FN2] [*3]

The first section of this provision places the onus upon the customers. However, DEP undertook to install water meters upon request. This undertaking was authorized by the Rate Schedule and was apparently part of the effort by DEP to come into conformity with the SPDES permits for authorized discharge from the Wards Island Water Pollution Control Plant and was done pursuant to the consent decree reached in a proceeding brought by the New York State Department of Environmental Conservation.[FN3]

When DEP took upon itself the obligation to install water meters upon request, and announced that a timely request would prevent a surcharge, it relieved those customers who had made such timely requests of the effects of that portion of the Rate Schedule that imposed surcharges upon customers who did not install meters by July 1, 2000. Any other reading of this provision denies petitioners proper notice and effects an unreasonable retroactive application of this provision. Consequently, as to the petitioners KP Realty and 2222 Management, there was no basis upon which to impose surcharges since they took all those steps necessary to avoid a surcharge under these rules and in light of the procedure announced by the DEP. Nor did petitioners' subsequent installation of meters violate the second part of this rule which imposes a surcharge only for the refusal to permit the installation of a meter. No other governing rule or provision has been brought to this Court's attention that would authorize the imposition of surcharges under these circumstances.

Consequently, the decision of the Executive Director of the Water Board herein challenged in effect alters the rates called for in the Rate Schedule by creating an unauthorized surcharge. Since rates can only be effected through the mechanism of the publication and public hearing requirements set forth in the NY Public Authorities Law §1045-j(3), the promulgation of different and additional rates is ultra vires and must be set aside.

A different result may obtain with regard to petitioner, 1773 East 12th Street. There, an attempt was made by DEP's plumber to install a meter which attempt was unsuccessful. It is quite possible that said attempt would constitute a "refusal to permit an installation" under the Rate Schedule authorizing the imposition of a surcharge. However since the determination of the Water Board's Executive Director did not address this aspect, this petition is dismissed and the matter remanded for [*4]consideration de novo,

The petitions of KP Reality and 2222 Management Corp are granted, the decisions of respondent New York City Water Board denying their requests to vacate the surcharges are set aside and the surcharges are vacated. The petition of 1773 East 12th Street is dismissed and the matter remanded to the New York City Water Board for de novo consideration.

This constitutes the decision and order of the Court.

J.S.C.

Footnotes


Footnote 1:2222 Management Corp/Katz Realty Management By letter dated June 13, 2000 and received on June 20, 2000, petitioner made a timely request for meter installation. (Respondent asserts that when it issued meter installation permits to petitioners all previous records were deleted from its computers and they thus cannot confirm nor deny the timeliness of the petitioner's original requests). However, the DEP failed to install a meter and 100% surcharges were imposed on petition's water bill commencing July 1, 2000. Nearly one year later on May 2, 2001, petitioner had a meter installed using its own plumber to avoid the continuation of additional surcharges. Petitioner was reimbursed $4,700 for the meter installation expense. DEP cancelled the surcharge effective the same day. However, petitioner was surcharged $18,348 for the period between July 1, 200 and May 2, 2001. K.P. Realty By letter dated June 13, 2000 and received on June 20, 2000, petitioner, made a timely request for meter installation. However, the DEP failed to install a meter and 100% surcharges were imposed on petition's water bill commencing July 1, 2000. Nearly one year later on May 31, 2001, petitioner had a meter installed using its own plumber to avoid the continuation of additional surcharges. Petitioner was reimbursed $3,400 for expenses. DEP cancelled the surcharge effective the same day. However, petitioner was surcharged $23,357.25 for the period between July 1, 200 and May 31, 2001 when it installed its meter. 1773 East 12th Street, LLC. By letter dated June 13, 2000 and received on June 20, 2000, petitioner made a timely request for meter installation. 100% surcharges were imposed on petition's water bill commencing July 1, 2000. On March 23, 2001, DEP's plumber, Varsity, attempted to install a meter, but apparently was unsuccessful. According to respondent, their representative could not install a meter because the superintendent was not available. According to the respondent, On April 18, 2001, NYWM informed Varsity that it would be installing its own meters under the Reimbursable Metering Program. Petitioners's argue that this is in conflict with the plumber's notes that indicate that respondent refused to install a meter under the reimbursable metering program. On May 27, 2002, petitioner had a meter installed using its own plumber to avoid the continuation of additional surcharges. The amounts in dispute are the 100% surcharges billed for the period July 1, 2000 to May 27, 2002, which according to the respondents is 40, 489.68

Footnote 2: The fiscal year 2001 rate schedule effective July 1, 2000 provided that the DEP Commissioner was authorized to install meters on all premises. Appendix A, Part vii, Section 1.A. of the rate schedule provides as follows: "an annual surcharge will be imposed equal in amount to 100% of either the last annual unmetered water charge or the last annualized meter charge when a customer fails to install a meter or a remote reading device. The surcharge will be applied from July 1, 2000 until the date the installation, repair or replacement takes place. An annual surcharge will be imposed equal in amount to 100% of either the last annual unmetered water charge or the last annualized meter charge when a customer refuses to permit the installation, repair, replacement or inspection of either a meter, a remote reading device or a water-consuming fixture. The surcharge will be applied from the date of the first refusal until the date the installation, repair or inspection takes place."

Footnote 3: Matter of the Violations of the New York State Environmental Conservation Law 17-0801 -by- The City of new York Department of Environmental Protection, DEC File R2-0777-93-01(NYSDEC)