City of Dover v. Cassidy Commons, LLC.

CourtSuperior Court of Delaware
DecidedFebruary 27, 2024
DocketK21C-06-042 JJC
StatusPublished

This text of City of Dover v. Cassidy Commons, LLC. (City of Dover v. Cassidy Commons, LLC.) is published on Counsel Stack Legal Research, covering Superior Court of Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Dover v. Cassidy Commons, LLC., (Del. Ct. App. 2024).

Opinion

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

: CITY OF DOVER, a municipal : corporation of the State of Delaware, : C.A. No. K21C-06-042 JJC : Plaintiff, : : v. : : CASSIDY COMMONS, LLC, : : Defendant. :

Submitted: February 6, 2024 Decided: February 27, 2024

POST-TRIAL DECISION

Nicholas H. Rodriguez, Esquire, SCHMITTINGER & RODRIGUEZ, P.A., Dover, Delaware, Attorney for Plaintiff.

Michael K. DeSantis, Esquire, Anthony N. Delcollo, Esquire, and Thomas H. Kramer, Esquire, OFFIT KURMAN P.A., Wilmington, Delaware, Attorneys for Defendant.

Clark, R. J. Plaintiff City of Dover (hereinafter “Dover” or “the City”) sues Defendant Cassidy Commons, LLC (“Cassidy”) for unpaid bills for electric service delivered to two commercial units. Although Cassidy owns the units, it contends it need not pay Dover because Cassidy’s commercial tenant assumed responsibility to pay the bills in their lease (hereinafter the “lease”).1 For that reason, Cassidy submits that Dover’s sole recourse is against the tenant, and not Cassidy.2 As explained below, the City’s electric tariff drives the result in this case because it identified Dover and Cassidy as the two parties to the contract and makes Cassidy responsible to pay the bill. After considering the tariff, the evidence and arguments presented at trial, and the parties’ post-trial submissions, the Court finds in favor of the City. Cassidy owes Dover $44,191.11.

I. PROCEDURAL AND FACTUAL BACKGROUND The City provided electricity to Suites E and F at 401 Cassidy Drive, in Dover (hereinafter “the units”).3 Cassidy owns the units but denies liability for the bills. When it denied liability, it filed a third-party complaint against its tenant, Underminers, LLC (“Underminers”) for indemnification.4 Underminers did not file a response, and Cassidy obtained a default judgment against Underminers as to liability.5 Thereafter, Dover and Cassidy stipulated to a bench trial which the Court held on January 17, 2024. From the start of the case through the end of trial, the

1 Pre-Trial Stipulation and Order (D.I. 54). 2 Id. 3 Compl. (D.I. 1); see also Def.’s Ex. 1, Commercial Lease Summary Page (identifying units E and F as the subjects of the instant dispute). 4 Third-Party Compl. (D.I. 23). 5 See D.I. 44 (granting an entry of default judgment against third-party defendant Underminers, LLC).

2 parties focused their arguments on common law contract principles. At the conclusion of trial, the Court observed that Dover’s claim for unpaid electric charges implicate aspects of public utility law. As a result, it asked the parties whether Dover’s electric tariff answers the question of who must pay – (1) the landlord that owned the units, applied for the service, and kept its name on the account, or (2) the tenant who occupied the unit and used the electricity.

II. POSITIONS OF THE PARTIES Dover seeks $44,191.11 from Cassidy for service provided to the units from January 2018 through December 2019.6 The common law aspect of the City’s claim focuses on the fact that Cassidy applied for the service,7 the units received the service, and Cassidy’s name remained on the account until Cassidy asked Dover to terminate service in December 2019.8 Dover contends that these facts demonstrate Cassidy’s liability in contract regardless of whether Cassidy separately delegated its responsibility to pay to another.9 Initially, Dover focused only on common law contract principles to support its claim against Cassidy.10 Presently, the City also relies upon the electric tariff and City Code provisions that it contends identify Cassidy as the responsible party.11

6 D.I. 1. 7 Pl.’s Ex. 1; see also D.I. 64 (arguing that Cassidy is liable for the unpaid balance because Mark North, an authorized agent for Cassidy, signed the application for service and thereby formed a binding contract with Dover). 8 Pl.’s Ex. 2. at 2. 9 D.I. 54. 10 Id. 11 See D.I. 67 (arguing that the tariff and the City Code provides that property owners who have submitted and signed and application for service are responsible for the payment of that service and that the City’s electric tariff sets the rate).

3 Cassidy denies liability but does not dispute the amount of the unpaid bill due Dover. As did Dover, Cassidy initially relied upon common law contract principles in defense. It contends that only Underminers could be held liable because Underminers assumed the duty to pay pursuant to the lease.12 Although Cassidy offered no evidence that either it or Underminers presented a copy of the lease to Dover, it submits that Dover should have known that Cassidy delegated the duty to Underminers because other Cassidy Commons tenants provided their identically-termed leases to Dover.13 Finally, Cassidy relies on the reasoning in a Connecticut trial court decision: Connecticut Light & Power Co. v. Hartmann’s Enterprises, Inc.14 That decision, it contends, demonstrates that Underminers, and not Cassidy, had the duty to pay.15 After trial, the Court asked the parties to address the impact of Dover’s electric tariff on their case. It did so because tariffs establish the terms of the relevant contract between a utility and a ratepayer, and a city council approved tariff carries the force of law.16 In Dover’s post-trial submission, it identified the customer classification included in the tariff that it contends applied to the units.17 Dover emphasizes that the tariff incorporates certain City ordinances, that in turn, incorporate the City of Dover Municipal Electric Department’s Service Handbook (the “Handbook”) into

12 See Def.’s Ex. 1 § 4 ¶ A [hereinafter Lease Agreement] (stating that the tenant is responsible for initiating electric service and paying the resulting charges). 13 D.I. 68 at 7. 14 2007 WL 2429226 (Ct. Super. Aug. 10, 2007). 15 D.I. 68. 16 See 64 Am. Jur. 2d Public Utilities § 52 (2023) (“Under the filed-rate doctrine, a tariff filed with and approved by an administrative agency [or a municipality] under a statutory scheme is more than a mere contract; such a tariff acquires the force and effect of law.”). 17 See D.I. 67 at 3 (asserting that Cassidy Commons falls into the “C5” classification for Large Commercial customers).

4 the tariff.18 In combination, Dover contends that the tariff, the City Code, and the City rules and regulations make Cassidy the responsible party. Cassidy disagrees and counters that Dover’s electric tariff and Code provisions demonstrate the opposite – that is, Underminers is Dover’s customer, not Cassidy.19 Finally, Cassidy objects to Dover’s recent attempt to specify the customer classification for the units because Dover offered no evidence at trial to support it.20

III. STANDARD In a bench trial, the Court sits as the trier of fact.21 In civil actions, the burden of proof is by a preponderance of the evidence.22 To carry this burden, the party who holds the burden of proof on an issue must prove that the contested matter is more likely true than not.23 In a judge’s role as a trier of fact, he or she must judge the witnesses’ credibility and determine the weight to assign their testimony.24 When doing so, the Court is “free to accept or reject any or all of the sworn testimony, as long as

18 Id. at 2–3. 19 See D.I. 68 at 2–3 (arguing that because Cassidy was not the one paying the bills or occupying the premises, Cassidy does not qualify as Dover’s customer per the definition supplied in the Handbook); see also CITY OF DOVER, ELECTRIC SERVICE HANDBOOK 11 (2023) (“[A] customer is any adult person … or other entity: (i) in whose name a service account is listed, (ii) who occupies or is the ratepayer for a premises …, and (iii) who is primarily responsible for payment of bills.”) 20 See D.I.

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Bluebook (online)
City of Dover v. Cassidy Commons, LLC., Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-dover-v-cassidy-commons-llc-delsuperct-2024.