Berkeley County Public Service District v. Vitro Corp. of America

162 S.E.2d 189, 152 W. Va. 252, 1968 W. Va. LEXIS 149
CourtWest Virginia Supreme Court
DecidedJune 25, 1968
Docket12704
StatusPublished
Cited by123 cases

This text of 162 S.E.2d 189 (Berkeley County Public Service District v. Vitro Corp. of America) is published on Counsel Stack Legal Research, covering West Virginia Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Berkeley County Public Service District v. Vitro Corp. of America, 162 S.E.2d 189, 152 W. Va. 252, 1968 W. Va. LEXIS 149 (W. Va. 1968).

Opinion

Berry, President:

This is an appeal by Vitro Corporation of America, a corporation, from a final judgment of the Circuit Court of Berkeley County, West Virginia, of January 13, 1967, in *254 a declaratory judgment proceeding in which the trial court construed a contract between the plaintiff and defendant and held, among other things, that the defendant, Vitro Corporation of America, was obligated to pay to the plaintiff, Berkeley County Public Service District, the minimum sum of $275 per month for potable water for industrial and sanitary purposes, whether used or not, for a period of 40 years beginning August 1, 1959, and ending July 31, 1999, and rendered judgment against the defendant in the amount of $23,595 for said minimum payments due the plaintiff which accrued after the defendant notified the plaintiff that its plant was closed and that it no longer required any water to be furnished to it.

An appeal and supersedeas were granted by this Court on November 6, 1967, and the case was submitted for decision on arguments and briefs of both parties at the April Special Docket of the January, 1968, Regular Term.

The water contract involved in this case grew out of a projected and actual industrial development in Arden District in Berkeley County, West Virginia, near the City of Martinsburg. In 1952, Thieblot Aircraft Corporation built a plant at or near the Martinsburg Airport worth about $800,000, which was served by water obtained from a well. However, this water was corrosive and not satisfactory for the use of the defendant and a better water supply was desired. In 1956 the Thieblot plant became a division of Vitro Corporation of America and Armand Thieblot, president of Thieblot, became the head of the Thieblot division of the Vitro Corporation when they merged. Around 1954, efforts were made to establish a water service district in the area outside the City of Martinsburg where the municipal airport was located, and where the Thieblot plant had been built. An adequate unutilized supply of good water from a private source was located a few miles from this area, and the City of Martinsburg did not desire to serve the area through its municipal water works. Consequently, action was taken to obtain the output of this private water supply known as LeFevre Springs, which was owned by the descendants of one of the early settlers in that area. Other plants were also located in this area, such as the *255 C. H. Musselman Company dealing in apple products, which were potential customers of the water service district.

Negotiations of water contracts with Thieblot and other companies and the organization of a water service district were made and undertaken at about the same time. The evidence indicates that the public service district was initially motivated by the prospect of a long-term water contract with Thieblot as well as others and would not have come into being if this prospect had not existed. The plaintiff claims that the resulting contract binds the defendant to pay for water used by it since it ceased operation of its plant in that area in 1960.

The contract which was introduced in the evidence is dated November 18, 1958, was executed by the Vitro Corporation of America on that date and executed by the Berkeley County Public Service District on November 20, 1958, was substituted for a prior contract dated May 1, 1958, which was cancelled by the November 18, 1958, contract, and provided that not later than May 31, 1959, at least some of the water provided for in said contract would be furnished. However, the evidence is uncontradicted that water was not furnished under the contract in question until August 1, 1959. The contract in question contains two conditions upon which charges under the contract were to be made: (1) Available water for fire protection at the rate of $400 per month, and, (2) water which Vitro “shall require” for industrial and drinking purposes at rates to be fixed by the Public Service Commission of West Virginia. Both the water services for fire and industrial and drinking purposes were to continue for a period of 40 years but the charge for the available water for fire protection purposes was subject to an adjustment at the end of ten years from the date of the contract, and every five years thereafter. The water for industrial and drinking purposes was to be furnished to Vitro as it shall require at the rates from time to time approved by and on file with the Public Service Commission of West Virginia. The evidence indicates that Vitro understood it was to pay a minimum charge for available water for fire protection purposes with such water to be furnished at 50 pounds pressure, *256 with immediate availability of 1000 gallons a minute; but as to the clause concerning payments for industrial and drinking water the evidence indicates that Vitro did not understand that it was bound to pay for forty years at a minimum rate, whether water was used or not and regardless of whether or not it remained connected as a customer to the public utility. The contract appears to have been negotiated at Martinsburg by both local and non-resident negotiators, after which it was forwarded to other offices for approval. Considerable evidence as to "what the parties intended was introduced by both the plaintiff and the defendant, and each claimed it was entitled to introduce the evidence to settle an incorrect interpretation insisted upon by the other, or that the evidence so introduced was not an interpretation but was merely establishing a collateral fact which caused the contract to be negotiated and executed.

An unusual situation exists in which each party insists that the contract is not ambiguous but is clear, although they came to opposite conclusions as to how to charge under the contract. The trial court judge stated that if the parties were unable to agree as to the conditions of the contract he would consider it ambiguous. This, no doubt, accounts for the numerous objections made throughout the trial by each party to the introduction of evidence by the other touching in any manner on the negotiations of the contract.

The case was tried by the judge in lieu of a jury and the plaintiff introduced considerable evidence showing that after the contract was negotiated a loan was approved by the United States of America Housing and Home Financing Agency to establish the district and that an investment banker sold bonds of the public service district; that neither of these acts would have taken place according to the testimony and documents of the agency and banker except that they, after examination of the contract, concluded that it bound Vitro to pay $400 a month for fire protection and $275 a month for industrial and sanitary water, making a total of $8100 a year to last for 40 years. This evidence was objected to by the defendant on the ground that it was interpreting the contract, which was the prerogative of the court and not the witness. An examination of such evidence *257 indicates that the witnesses were not connected with the negotiations of the contract but took collateral steps based upon an interpretation of what they thought the contract meant.

Inasmuch as the interpretation of the conditions contained in the contract in question are matters for the court to determine, considered with any proper evidence, the entire contract is hereby quoted:

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Cite This Page — Counsel Stack

Bluebook (online)
162 S.E.2d 189, 152 W. Va. 252, 1968 W. Va. LEXIS 149, Counsel Stack Legal Research, https://law.counselstack.com/opinion/berkeley-county-public-service-district-v-vitro-corp-of-america-wva-1968.