IRVIN WATER DIST. v. Jackson Partnership

34 P.3d 840
CourtCourt of Appeals of Washington
DecidedNovember 15, 2001
Docket19244-0-III
StatusPublished
Cited by9 cases

This text of 34 P.3d 840 (IRVIN WATER DIST. v. Jackson Partnership) is published on Counsel Stack Legal Research, covering Court of Appeals of Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
IRVIN WATER DIST. v. Jackson Partnership, 34 P.3d 840 (Wash. Ct. App. 2001).

Opinion

34 P.3d 840 (2001)
109 Wash.App. 113

IRVIN WATER DISTRICT NO. 6, a municipal corporation of the State of Washington, Appellant,
v.
JACKSON PARTNERSHIP, a Washington general partnership; William J. Lawson and Carol K. Lawson, husband and wife and the marital community comprised thereof; Stephen D. Schmautz and Tresa R. Schmautz, husband and wife and the marital community comprised thereof; Loren L. Faris and Cheryl J. Faris, husband and wife and the marital community comprised thereof; Gunning and Lawson Investments, a Washington general partnership, Theodore G. Gunning and Diane D. Gunning, husband and wife and the marital community comprised thereof, Respondents and Cross-Appellants,
Pine Bluff Partnership, a Washington general partnership; Jeff K. Johnson and Kae A. Johnson, husband and wife and the marital community comprised thereof; Jeffrey L. McCloskey and Sherri N. McCloskey, husband and wife and the marital community comprised thereof; Ronald C. McCloskey and Sharon K. McCloskey, husband and wife and the marital community comprised thereof, Defendants.

No. 19244-0-III.

Court of Appeals of Washington, Division 3, Panel Three.

November 15, 2001.

*842 Dennis P. Hession, Michael J. Miller, Richter-Wimberley, Spokane, for Appellant.

Robert Drummond, Spokane, for Respondents. *841

*843 SWEENEY, J.

This is a dispute between real estate developers and Irvin Water District No. 6 over connection fees. The District provided the developers with water for fire and construction purposes. Later it substantially increased the connection charges. It did so before the developers actually applied for service and tendered the connection fees. The primary question before us is whether the District was committed to the connection fees in place when it first provided water to the developers. We have concluded that the District is not bound under any legal or equitable theory to supply water at the old, lower connection fees and that the appropriate fees were the fees in effect at the time the developers actually formally applied for and tendered the connection fees. We therefore reverse the trial court's ruling to the contrary. We do, however, remand the case to the trial court for calculation of the appropriate connection fees set out in former RCW 57.08.010(3) (1994).

I. FACTS

A. PARTIES

Gunning and Lawson Investments (G & L) built an apartment complex. William Lawson and Stephen Schmautz, the Jackson Partnership, built a commercial building. Both projects are within the service boundaries of Irvin Water District No. 6. G & L and Jackson will be collectively referred to as the "Developers."

B. WATER USE FOR CONSTRUCTION

G & L talked to the District's General Manager, George Shearer, about water service in January 1994. Mr. Shearer quoted an incorrect connection fee. But he did approve G & L's proposed utilities plan on February 18, 1994. The utilities plan stated that the District had sufficient water to supply the Developers' projects.

Sometime during the spring, Betty Skillingstad, the District's Office Manager, reminded Mr. Lawson of the need to formally apply for water service and pay the connection fees.

Construction on G & L's apartments began in late March 1994. The District provided water for fire protection and construction purposes at least by the end of April 1994. The Developers had installed several hundred feet of eight-inch water main as part of the project by the end of April. The water line became the District's property upon completion of the project. At the same approximate time, G & L tapped into the District's water service at four different locations. Two additional taps were made into the new eight-inch main line. The District's manager approved these connections. Water was not yet, however, available for domestic use because it had not been tested. The Developers used the water for construction and fire control only.

C. CONNECTION FEE ADJUSTMENT

The District's Board of Commissioners met in June 1994, and talked about new growth, its effect, and the need to adjust connection fees to reflect increased costs.

Ms. Skillingstad called Mr. Lawson after the June Board meeting and again reminded him of the need to file an application for service and the need to pay the connection fees. She also reported that the District was considering an increase in connection fees.

On July 12, 1994, the District's Board adopted a new connection charge of "$1,000 per unit for multi-unit buildings." Clerk's Papers at 94. Fees for the apartment project under the new fee schedule rose from $19,000 to $140,000.

The Developers never applied for service or paid the connection fees requested by the District. Both steps are required by District regulations and bylaws to secure service.

The District told the Developers of the increased connection fees. The Developers then tried to tender the fees required under the old schedule. The District rejected the tender.

D. COURT PROCEEDINGS

The District sued for a judicial declaration that the new connection fees were lawful and that they applied to the Developers.

*844 Following a bench trial, the judge concluded that the new connection fees were properly adopted and lawful. But the judge also concluded that the Developers became "customers" of the District before adoption of the new charge. It therefore permitted the Developers to pay the fees in effect before adoption of the new increased connection fees.

The District appeals, arguing that the new connection fee is applicable to the Developers. The Developers cross-appeal, arguing the new fee is really an invalid tax and that it was calculated incorrectly.

II. APPLICATION OF CONNECTION FEE

A. STANDARD OF REVIEW

"The standard of review for a trial court's findings of fact and conclusions of law is a two-step process. First, we must determine if the trial court's findings of fact were supported by substantial evidence in the record. If so, we must next decide whether those findings of fact support the trial court's conclusions of law." Landmark Dev., Inc. v. City of Roy, 138 Wash.2d 561, 573, 980 P.2d 1234 (1999).

B. CUSTOMER

The trial judge conferred the status of "customer" on the Developers and then ascribed legal consequences to that status, tantamount to "vesting."[1] But we find no statute, case, or rule that attaches legal consequences to the status of "customer" in this context.

The questions here are whether these new connection fees apply to the Developers and, of course, if they do, why?

The District argues that the Developers must pay the new connection fees because they neither applied for service nor paid the applicable fees before the Board adopted the new fees. The Developers respond that the new fees do not apply to them for a variety of reasons. First, they were "vested" under the old fees. Next, they had an implied contract with the District for the old fees. Or, finally, the District is either estopped or has waived its right to apply the new fees to them. We consider each of the arguments in order.

C. VESTING

The Developers argue that they have a vested right to the connection fees in place on July 11, 1994, and rely on Landmark Dev.[2]

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