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North Farm Home Owners Association, Inc. v. Bristol County Water Authority

Superior Court of Rhode Island, Providence

August 16, 2018

NORTH FARM HOME OWNERS ASSOCIATION, INC., Plaintiff,
v.
BRISTOL COUNTY WATER AUTHORITY, Defendant.

          For Plaintiff: Barry J. Kusinitz, Esq.

          For Defendant: Joseph A. Keough, Jr., Esq.

          DECISION

          SILVERSTEIN, J.

         Before the Court for decision is Plaintiff North Farm Home Owners Association, Inc.'s (North Farm) motion for preliminary injunction against Defendant Bristol County Water Authority (BCWA). Defendant has objected to Plaintiff's motion and has filed a motion to dismiss Count III of Plaintiff's Complaint requesting injunctive relief. This Court exercises jurisdiction pursuant to G.L. 1956 § 8-2-14.

         I Facts and Travel

         The North Farm Condominium, located in Bristol, Rhode Island, began development in 1973. As part of the first phase of development, the Condominium developer granted a utility easement to BCWA in specified common areas for the purpose of constructing, laying, repairing, maintaining, and replacing "water pipelines and necessary and proper valves and other appliances" for use in connection with the transmission and distribution of water and subsequent construction, inspection, and maintenance of the pipelines. The easement further stated that all water pipelines would remain "at all time[s] and forever" the sole property of BCWA and shall not be considered fixtures in or on the land. As part of the initial installation of the water pipelines, BCWA installed a number of branches extending from water mains to "pits" located near each building. Each of these pits contained separate water meters for each of the individual condominium units serviced by that pit.

         In or about 1993, a representative of BCWA approached North Farm to change the metering system from separate condominium meters to a single, central meter. There was no alteration to the original easement pursuant to the installation of the central meter. Nor did the installation of the central meter alter the ownership status or maintenance obligations related to the already installed water pipelines.

         In February 2014, North Farm experienced a break in a water pipe covered by the initial easement. North Farm reported the break to BCWA and requested that it repair the broken pipe pursuant to the easement. BCWA denied responsibility for the water pipe as it was past the location of the central meter. North Farm subsequently experienced three additional breaks in the water pipeline between 2014 and 2017. As a result, North Farm has paid $58, 296.86 for costs of repairs to the water pipes.

         North Farm filed its Complaint in conjunction with a motion for a temporary restraining order on September 28, 2017. Following a conference attended by counsel for both parties, the Court entered an Order issuing a temporary restraining order which still remains in effect. BCWA subsequently answered North Farm's Complaint and filed a six-count Counterclaim.

         II Parties' Arguments

         North Farm here asserts that correspondence between it and BCWA constitutes a contract that binds BCWA to the agreed upon terms. Namely, Plaintiff contends that BCWA indicated that following the installation of the central meter it would "continue the present maintenance repair and/or replacement of water mains within the easement granted to BCWA when North Farm was built." (Pl.'s Ex. 3, Cooney Letter, May 11, 1994.)

         Moreover, North Farm argues that the agreement is not void, as BCWA suggests, because BCWA's function in furnishing water to the condominiums is proprietary and, therefore, nongovernmental. Because BCWA is not engaged in a governmental function, North Farm asserts that the doctrine of apparent authority applies. Simply put, North Farm argues that BCWA's and North Farm's then representatives had the authority to bind the parties to the agreement's terms in the same fashion as any other nongovernmental entity would be bound by its agents and servants. To support this contention, North Farm points to BCWA's Rules and Regulations Governing Rendering of Service §9(a) and (c) entitled "Meters and Meter Installations." This section indicates that the Authority-which is defined elsewhere in the Rules as "the Bristol County Water Authority, acting through its Officers, Executive Director, Manager or other duly authorized employees or agents, each acting within the scope of the particular duties entrusted to him[]"-after consultation with the customer shall specify the type, size, and location of the meter to be installed.

         Conversely, BCWA argues that its enabling legislation controls its ability to contract. The legislation states that "[t]he powers of the authority shall be vested in a board of directors. . ." and, elsewhere, that the authority shall have the power "to fix rates and collect charges for the use of the facilities . . . or services rendered[.]" Sec. 7(a); Sec. 6(a)(6). The Act further states that the authority shall have the power to "make and execute" agreements and contracts "necessary or convenient in the exercise of the powers and functions of the authority granted by this act." Sec. 6(a)(8). Here, the agreement with North Farm was not presented to nor voted on by the Board of Directors. Therefore, BCWA argues the agreement is invalid.

         BCWA also contends that a preliminary injunction would prohibit the Board of Directors from exercising its statutory power to charge administratively approved ...


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