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Craft v. District of Columbia Water and Sewer Authority

Court of Appeals of The District of Columbia

January 18, 2018

Willie T. Craft, Petitioner,
District of Columbia Water and Sewer Authority, Respondent.

          Submitted November 30, 2017

         District of Columbia Water and Sewer Authority, Respondent. Petition for Review of an Order of D.C. Water and Sewer Authority (0108321-1)

          Willie T. Craft, pro se. Randy McRae submitted a brief as attorney for petitioner at the time the brief was filed.

          Emil Hirsch and Steven A. Pozefsky filed the brief for respondent.

          Before Glickman and Thompson, Associate Judges, and Ferren, Senior Judge.

          Ferren, Senior Judge.

         Appellant Willie T. Craft seeks a refund of more than $77, 000 from the DC Water & Sewer Authority ("DC Water") based on a billing dispute for the period January 1974 to January 2014. The dispute concerns two adjacent lots in the 4300 block of Nannie Helen Burroughs Avenue, Northeast (the "Craft lot" and "McDonald's"), which share a private service line from the water main. Because any application for a refund must be made within two years after an erroneous payment (as the hearing officer properly ruled), [1] we may consider Craft's claim only for the period beginning January 21, 2013, based on his Claim for Refund of Overpayments dated January 21, 2015. We affirm.

         I. Facts and Proceedings

         The developer of the property covering both lots[2] installed one private, underground water service line, which originated on the Craft lot and serves not only the businesses there (a dry cleaner, flower shop, and daycare center), but also the neighboring McDonald's franchise. On January 21, 2015, Craft filed his claim for refund totaling somewhere between approximately $77, 000 and several hundred thousand dollars, based on alleged double-billing for McDonald's water.[3]Craft alleged, more specifically, that all the water for both properties "ran first through [his] meter, " and was charged to him, then "diverted to the McDonald's property, where it was metered again" and charged to McDonald's. Craft thus sought a refund of the dollars charged to him for McDonald's water.

         On February 27, 2015, in a letter from Laura Preston, the utility's Customer Service Director, DC Water denied the claim on the ground that the problem was attributable to construction of a "shared water service line" for both properties. The denial letter stated that, with the exception of a malfunctioning water meter (not at issue here), DC Water's responsibility for maintaining infrastructure ends at the property line.[4] It explained DC Water's legal position as follows:

In accordance with the Laws of the District of Columbia each property owner is responsible to construct, provide and maintain the plumbing and related appurtenances within the private property boundary for their own use. To our knowledge this has not been done. At present Mr. Craft is responsible financially for all water use recorded on the meter assigned to his account. In order for there to be two separate accounts, two separate lines from our water main, one to each property, are required. The responsibility to resolve this condition is solely on the owners of the commercial properties, Mr. Craft and McDonald's, and not DC Water's. [Emphasis added.]

         Craft petitioned for an administrative hearing, which was held on March 1, 2016.[5] The petition alleged that from January 1974 to January 2014, Craft (and, before him, his father) paid DC Water for the water serving both lots - Craft's and McDonald's - and that Craft is therefore entitled to a refund totaling: (1) the $77, 237.04[6] paid by McDonald's to DC Water, with "appropriate deductions for the retroactive credit [of $8, 920.84] to [Craft's] account" paid by DC Water;[7] (2) "an amount equal to all water bills paid by [McDonalds] from October 1974 to October 2002"; (3) "appropriate interest on the refund amounts above"; and (4) other relief deemed "just and appropriate."

         At the hearing before a DC Water hearing officer, Craft testified he had learned from his father that, when the Craft family purchased its lot "from McDonalds"[8] forty years earlier, his father thought that McDonald's had "fixed" the water meter to serve only the Craft lot. However, "for forty years" (apparently without investigation), his father kept "scratching his head" at the "high water bills." Thus, when appellant Craft took over responsibility for the family property, he contacted DC Water in October 2012 with an unjust enrichment theory: that the Crafts were receiving bills not only for the water they used but also for the water consumed by McDonald's on the next lot - a situation that DC Water, in April 2013, confirmed as true. To document this contention in his Claim for Refund, Craft quoted from an email of June 25, 2014, from Laura Preston, DC Water's Customer Service Director, to a member of the D.C. Council staff:

The way the current construction works, all of the water [which] goes through the meter for both properties goes through Mr. Craft's meter first inside his property boundary, and then some of it is diverted and goes to Mr. Mateos' restaurant, where it is metered again. We send two bills - one to [Craft] and one to [McDonald's].

         After using this excerpt to explain the current situation, Craft summarized the history of his water bills, as described in the email:

Effective January 1, 2014, DC Water instituted a "special arrangement" for the benefit of [Craft] and [McDonald's] in which DC Water calculates their bills under the following new formula: ". . . we take all of the water that shows up in [McDonald's] meter and subtract it from [Craft's] bill so that Mr. Craft is only billed for the net amount that he and his neighbors. . . use."
As for the issue of double billing, [Craft] was given a "retroactive credit" in the amount of $8, 920.84. This figure was based on the amount of water billed to McDonald's from March 2013 until January 2014.[9]

         Craft understood this email to reflect DC Water's acknowledgement that, over time, he had been paying the water bill for both lots, in addition to McDonald's payment for its own lot, resulting in double-billing for McDonald's water. However, Craft does not dispute the "special" credit arrangement reflected in Ms. Preston's email. Rather, he argues that the refunds to date have been too meager. He therefore asks for a larger refund based on a new calculation: (1) total all the water bills to McDonald's to be found in DC Water's records; (2) use "yearly averages" to calculate McDonald's bills for earlier years, allowing for "fluctuations in water prices"; and (3) total those two amounts, adding "appropriate interest."[10]

         A review of the record reveals that, for a substantial period, DC water essentially followed Craft's methodology in deducting McDonald's water usage from Craft's bill. To facilitate a long-term solution between Craft and McDonald's, DC Water provided Craft with a number of "courtesy" billing accommodations. The hearing officer found that, beginning March 27, 2013 - two months after the claim period permitted by the statute of limitations began[11] - "DC Water stopped billing Craft based upon the water meter reading" for both lots. Instead, it "start[ed] estimating [Craft's] water usage" and "bill[ing] McDonald's separately for its water usage, "[12] an arrangement that (as noted in the Laura Preston email) yielded Craft an additional credit of $8, 920.84 through January 29, 2014. Thereafter, "DC Water provided an accounting adjustment [that] subtracted any water billed to McDonald's from Mr. Craft's account as a courtesy." The hearing officer therefore agreed with DC Water's "characterization of how Mr. Craft's water bills have been handled by DC Water from the point that he raised his suspicion of double-billing." She concluded that "[t]he facts and evidence do not support Mr. Craft's allegation of double-billing." In other words, DC Water had cured the situation beginning March 27, 2013.

         The idea underlying the courtesy adjustment was "to facilitate the property owners coming up with an agreement for separating the water line between their respective properties or devising an accounting arrangement between them." Although the record reflects an effort by Craft and McDonald's to negotiate such an agreement whereby McDonald's would pay Craft "for the use of the water line, " it does not appear that this has occurred.[13] As a result, in its February 27, 2015, letter responding to Craft's claim, DC Water stated that it planned to "cease to do the courtesy accounting adjustment in May 2015" and urged Craft to work toward resolving the matter "quickly." According to a subsequent letter to Craft dated January 27, 2016 (an unrebutted exhibit at the hearing), DC Water indicated that in May 2015, it ...

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