City of Lumberton v. U.S. Cold Storage

631 S.E.2d 165, 178 N.C. App. 305, 2006 N.C. App. LEXIS 1397
CourtCourt of Appeals of North Carolina
DecidedJuly 5, 2006
DocketNo. COA05-889.
StatusPublished
Cited by2 cases

This text of 631 S.E.2d 165 (City of Lumberton v. U.S. Cold Storage) is published on Counsel Stack Legal Research, covering Court of Appeals of North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Lumberton v. U.S. Cold Storage, 631 S.E.2d 165, 178 N.C. App. 305, 2006 N.C. App. LEXIS 1397 (N.C. Ct. App. 2006).

Opinion

CALABRIA, Judge.

United States Cold Storage, Inc. ("defendant") appeals an order granting summary judgment for breach of contract and violation of the City of Lumberton's ("plaintiff") water and sewer regulations. We affirm in part and reverse and remand in part.

Defendant, a New Jersey corporation, owns one hundred and thirty two (132) acres of land in Robeson County, North Carolina, outside plaintiff's corporate limits where it built and operates a commercial cold storage/refrigeration facility for meat and produce. In June of 1987, the parties entered into a water and sanitary sewer service contract ("the contract"). Plaintiff agreed to install and provide water and sanitary sewer services to defendant. The plaintiff further agreed to reserve one hundred fifty thousand (150,000) gallons per day for defendant's water and sanitary sewer needs for a five-year period. Defendant agreed to pay plaintiff the applicable rate required by Chapter 23 of the City of Lumberton's Code of Ordinances ("Code") for water and sanitary sewer usage. The contract included a provision stating any modification of the contract must be in writing and signed by both parties.

Subsequent to the contract, disputes arose regarding the amount of water actually used versus the amount of water that evaporated during the refrigeration process, the applicable rates required by the Code, and the billing method used by the plaintiff. As a result of billing errors from 1988 to 1995, plaintiff's bill never included sewer service. The estimated total due was approximately $250,000. As a result, the parties agreed new water meters were needed to measure the amount of water passing through the pipes to the cooling towers ("towers"). The meters were installed and the amount of water entering the towers was deducted from the total amount of water entering defendant's facility. The sewer rate was calculated on this reduced amount of water. This "negotiated" billing method proceeded from 1995 until 1999. In 1999, defendant drilled a well on its property to supply water to its towers. Afterwards, defendant applied for and was issued a permit. No well records exist from 1999 to December 2001.

On 4 February 2000, defendant filed suit in federal district court alleging, inter alia, plaintiff retaliated against defendant for exercising its First Amendment rights by threatening to discontinue water, sewer, and fire protection services and breached the contract by not calculating defendant's sewer bill in accordance with a "negotiated" billing method. Judge James C. Fox ("Judge Fox") determined plaintiff did not violate defendant's First Amendment rights and further, did not breach their "negotiated" billing method. The Fourth Circuit Court of Appeals affirmed.

On 1 February 2002, plaintiff filed a complaint in Robeson County Superior Court alleging breach of contract and violation of multiple Code ordinances. On 5 April 2002, defendant filed an answer asserting eight affirmative defenses as well as several counterclaims. On 3 May 2002, plaintiff filed a response to defendant's counterclaims. Both parties filed motions for summary judgment.

On 16 February 2005, the trial court granted plaintiff's motion for summary judgment and denied defendant's motion for summary judgment. Specifically, the trial court ordered defendant to pay plaintiff the following: $208,067.02 for unpaid utility fees from 1 February 1999 to 31 December 2001; $51,888.96 for sewer usage and $31,658.94 for water usage from 1 January 2002 to 30 June 2003 using the "water in/sewer out" formula. The court also ordered an undetermined amount for both water and sewer usage by applying a formula. Specifically, the court ordered "subsequent to June 30, 2003 and for *168all future billings" apply the water or sewer rate "to the cumulative total of the water supplied by [plaintiff] at the end of the monthly billing cycle plus [defendant's] well water, as measured by the water meter reading maintained by [defendant]." Defendant appeals.

I. Summary Judgment Standard:

Summary judgment is appropriate and "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that any party is entitled to a judgment as a matter of law." N.C. Gen.Stat. § 1A-1, Rule 56(c) (2005). "In deciding the motion, all inferences of fact ... must be drawn against the movant and in favor of the party opposing the motion." Purvis v. Moses H. Cone Mem'l Hosp., ___ N.C.App. ___, ___, 624 S.E.2d 380, 383 (2006) (citations omitted). "The party moving for summary judgment has the burden of establishing the lack of any triable issue." Id. The movant carries this burden "by proving that an essential element of the opposing party's claim is nonexistent or by showing through discovery that the opposing party cannot produce evidence to support an essential element of his claim." Zimmerman v. Hogg & Allen, 286 N.C. 24, 29, 209 S.E.2d 795, 798 (1974). "A trial court's ruling on a motion for summary judgment is reviewed de novo as the trial court rules only on questions of law." Coastal Plains Utils., Inc. v. New Hanover Cty., 166 N.C.App. 333, 340-41, 601 S.E.2d 915, 920 (2004).

II. Breach of Contract:

Defendant first argues plaintiff breached the 1987 agreement and exceeded its statutory authority by charging defendant for water and sanitary sewer service plaintiff never furnished. Specifically, defendant contends plaintiff cannot charge defendant the following: any amount for water defendant draws from its well; tens of thousands of dollars for sewer service based upon a volume of water which evaporates rather than enters plaintiff's sewer system; and, for water and sewer services based upon "historical use" rather than actual use.

We first address plaintiff's assertion that the doctrine of res judicata in the federal court action prohibit defendant's appeal in state court. Plaintiff contends the issue of whether the City Code is applicable to and/or enforceable against defendant has already been litigated and thus constitutes a final decision. We agree to the extent applicable to defendant's claims regarding sewer usage.

"`Under the doctrine of res judicata, a final judgment on the merits in a prior action in a court of competent jurisdiction precludes a second suit involving the same claim between the same parties or those in privity with them.'" Nicholson v.

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Bluebook (online)
631 S.E.2d 165, 178 N.C. App. 305, 2006 N.C. App. LEXIS 1397, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-lumberton-v-us-cold-storage-ncctapp-2006.