Shawnee Bend Development Co. v. Lake Region Water & Sewer Co.

419 S.W.3d 817, 2013 WL 1194758, 2013 Mo. App. LEXIS 353
Missouri Court of Appeals·Decided March 25, 2013·No. No. SD 32077·Published·Cited by 2 cases

Opinion

DON E. BURRELL, J.

Plaintiff Shawnee Bend Development Co., LLC (“Developer”) appeals what it claims is an inadequate judgment against Lake Region Water & Sewer Co. (“Company”) in the amount of $66,375.00 (plus interest) for breach of contract.1 Developer had constructed what the trial court described as “a major real estate development” known as “The Villages” near Lake of the Ozarks in Camden County. Company provides public water and sewer services in Camden County subject to regulation by the Missouri Public Service Commission (“the PSC”).2 To provide water and sewer services to the residents of The Villages, Developer and Company executed a series of three contracts.

Developer contends the trial court’s judgment was inadequate because it did not enforce Company’s obligation to pay Developer $1,000 each time a new customer connected to the water source built by Developer (“the well”). Developer contends such an obligation existed because: “the contracts between the parties” provided for reimbursement as required by the PSC’s rules; the trial court’s interpretation of the contracts would render “the contract [sic] illegal because it is inconsistent with the tariff issued by the PSC for [Company]”; and the “cause of action did not accrue until the last payment was due under each contract, which was less than 10 years before [Developer] filed the instant suit[,]” referring to the 10-year statute of limitation set forth in section 516.100.3

[819] Because we agree that the parties’ first contract required Company to pay Developer such a fee for each customer who connected to the well within 10 years of its construction (capped at the cost of constructing the well) and Developer’s cause of action accrued upon the last payment of money due under that contract, we reverse the judgment and remand the matter to the trial court to render a judgment based on the applicable evidence submitted by the parties and the law as set forth in this opinion.

Facts and Procedural Background

The evidence was presented to the trial court solely in the form of the following written records: a joint exhibit, including a stipulation of facts with attached “schedules”; additional exhibits received individually from the parties; and a supplemental stipulation. No live testimony was presented by either party. We present only those facts necessary to resolve Developer’s claim that the trial court misapplied the law in interpreting the parties’ contracts.

Company provides its services to the public subject to tariffs approved by the PSC. The applicable tariffs include rules. Rule 1 in Company’s tariff addressing water service defines certain terms that are relevant to our analysis.

(a) An “APPLICANT” is a person, firm, corporation, governmental body, or other entity which has applied for service; two or more APPLICANTS may make one application for a main extension.
(b) The “COMPANY” is [Company] acting through its officers, managers, or other duly authorized employees or agents.
(c)A “CUSTOMER” is any person, firm, corporation or governmental body which has contracted with [Company] for water service or is receiving service from [Company], or whose facilities are connected for utilizing such service.
(e) A “DEVELOPER” is any person, firm, corporation, partnership or any entity that, directly or indirectly, holds title to, or sells or leases, or offers to sell or lease, or advertises ■for sale or lease, any lots in a subdivision.! 4]
(g) The “MAIN” is a pipeline which is owned and maintained by [Company, located on public property or private easements, and used to transport water throughout [Company’s] service area.

Rule 14 of Company’s tariff addresses the extension of water mains and includes provisions regarding how an applicant is to be subsidized for creating a new source for supplying water:

(c) When the applicant’s property is too far from existing facilities and it is economical for a new source of supply to be constructed to. serve the applicant’s property, the applicant may be required, as a part of the extension agreement, to subsidize the costs associated with said new source until enough additional customers justify the cost to [Company] of owning and operating said source of supply. Such subsidization shall be based on a limit of capital investment by [Company] of $1,000 per customer connected to the said new [820] source, not to exceed the original cost to construct the well and applicable appurtenances and only during the first ten years following completion of an approved facility. Said new supply source (well) shall be in lieu of a main extension and to follow the same rules as a main extension.
(f) Refunds of contributions shall be made to applicant(s) as follows:
(2) During the first ten years after the main extension is completed, [Company] will refund to the applicant(s) who paid for the extension moneys collected from applicant(s) in accordance with paragraph (e) above [describing a method to calculate a per lot charge with a multiplying factor for larger commercial meters]. The refund shall be paid within 80 days after the money is collected.
(8) During the first ten years after a new source of supply is constructed, [Company] will refund to the applicant $1,000 for each new customer connected to the system constructed in accordance with Rule 14(c), not to exceed the subsidization made by the applicant in lieu of a main extension.
(h) [Company] reserves the right to further extend the main and to connect mains on intersecting streets and easements. Connecting new customers to such further extensions shall not entitle the applieant(s) paying for the original extension to a refund for the connection of such customers. Ten (10) years after an extension, both the refunds to the original applicants and payment to [Company] by new customers, cease for that extension.

On April 10, 1998, the parties executed an “Agreement Regarding the Installation of Water Mains, a Water Well, Sanitary Sewers and Appurtenances, and Road Crossings” (“Contract 1”). Under that agreement, Developer constructed “a new source of water in the form of [the] well[,]” water mains, sewer facilities, and a sewer “Trunk Line” with “excess capacity” (“the trunk line”) to the satisfaction of Company. Contract 1 specifically states that the construction was “to be installed in the development to be known as THE VILLAGES at Shawnee Bend, further described on Exhibit A hereto (the ‘Property’) by an independent contractor engaged by Developer.” Exhibit A was a legal description labeled “STONEBRIDGE VILLAGE of THE VILLAGES at SHAWNEE BEND” and described “84.10 [a]cres” (“Area l”).5

Concerning the construction of the well, Article I of Contract 1 provides:

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Shawnee Bend Development Co. v. Lake Region Water & Sewer Co., 419 S.W.3d 817, 2013 WL 1194758, 2013 Mo. App. LEXIS 353 (Mo. Ct. App. 2013).

419 S.W.3d 817 (Shawnee Bend Development Co. v. Lake Region Water & Sewer Co.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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