Opinion
C.A. PC-2017-4623
08-16-2018
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.
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 rates, a duty it is attempting to exercise here.
With respect to the Court's specific inquiry following oral argument in this matter regarding Section 14 of BCWA enabling legislation, North Farm relies primarily on two cases from our Supreme Court. First, City of Providence v. Hall, 49 R.I. 230, 142 A. 156, 158 (1928), which held that "[t]he city, in furnishing water is not engaged in a governmental function." Second, North Farm cites R.I. Student Loan Auth. v. NELS, Inc., 550 A.2d 624 (R.I. 1988), in which the Court found "that portion of RISLA's operations serviced by NELS [was] 'not so intertwined with governing that the government is obligated to perform it only by its own agents or employees.'" 550 A.2d at 627.
BCWA, however, contends that the Court's decision in Hall focused on the distinction between taxable and non-taxable property. In particular, the Court held that Scituate could tax Providence's property because there was no express statutory exemption. In response, BCWA contends that the Legislature incorporated the language of Section 14 to establish that BCWA would be performing "an essential government function." Moreover, BCWA asserts that the enabling legislation delegated several governmental duties and powers to BCWA in order to address a "condition of substantial and persistent water shortage" in Bristol County. These governmental powers include the power to issue bonds and condemnation power. BCWA also argues that, at the time of Hall, the distinction between governmental and proprietary functions was critical in tort claims against municipalities. Now, BCWA argues that distinction is no longer applicable and the Court's designation that furnishing water is not a governmental function, in Hall, is not persuasive.
Lastly, with regard to Defendant's Motion to Dismiss, North Farm contends that Count III is necessary to supplement Count IV, alternative claim for damages for BCWA repudiation and breach of agreement regarding central metering. North Farm claims that injunctive relief requires the allegation of additional elements not required for a simple damages claim and that injunction is clearly a remedy to restrain breach of contract or to protect rights in real property which are threatened by breach of contract. BCWA simply states that "injunctive relief is a remedy and, cannot, in itself, be recognized as a substantive claim." State v. Lead Industries Ass'n, Inc., No. 99-5226, 2001 WL 345830 (R.I. Super. Apr. 2, 2001).
III Standard of Review
In deciding whether to issue a preliminary injunction, the Court has regularly turned to Justice Bourcier's decision in Fund for Cmty. Progress v. United Way of Se. New England, 695 A.2d 517, 521 (R.I. 1997). In its decision, our Supreme Court outlined four factors to be considered, specifically the "hearing justice should determine whether the moving party (1) has a reasonable likelihood of success on the merits, (2) will suffer irreparable harm without the requested injunctive relief, (3) has the balance of the equities, including the possible hardships to each party and to the public interest, tip in its favor, and (4) has shown that the issuance of a preliminary injunction will preserve the status quo." Iggy's Doughboys, Inc. v. Giroux, 729 A.2d 701, 705 (R.I. 1999) (citing Fund for Cmty. Progress, 695 A.2d at 521). A certainty of success is not required; rather, only a prima facie case need be shown. Fund for Cmty. Progress, 695 A.2d at 521 (citing Coolbeth v. Berberian, 112 R.I. 558, 564-66, 313 A.2d 656, 660 (1974)). Further, "[a]n application for such temporary injunctive relief is, of course, addressed to a trial justice's sound discretion which should not be exercised unless the applicant has as least made out a prima facie case." Coolbeth, 112 R.I. at 564, 313 A.2d at 659-60.
IV Discussion
A Motion to Dismiss
First turning to BCWA's motion to dismiss, the Court has articulated on numerous occasions that "injunctive relief is not an independent cause of action; rather, injunctive relief is a remedy and, cannot, in itself, be recognized as a substantive claim." See, e.g., R.I. Econ. Dev. Corp. v. Wells Fargo Securities, LLC, No. PB 12-5616, 2013 WL 4711306, at *17 (R.I. Super. Aug. 28, 2013); F. Saia Restaurants, LLC v. Pat's Italian Food to Go, Inc., No. PB 12-1294, 2012 WL 2133511, at *10 (R.I. Super. June 6, 2012); Lead Indus. Ass'n, Inc., 2001 WL 345830, at *17. Accordingly, because Count III presents a separate cause of action for injunctive relief, the Court, in its typical course, would dismiss the claim and allow Plaintiff the opportunity to amend its Verified Complaint in order to seek injunctive relief as a remedy to other claims. Here, the Court will admonish North Farm to amend its Complaint to rectify the problems associated with Count III. The Court believes that following its normal course in the instant matter would only serve as a temporary delay to its deciding of the present issue.
B Preliminary Injunction
Before addressing the requested preliminary injunction, the Court must first establish whether BCWA's furnishing of water is a proprietary or governmental function. BCWA argues that its employee did not possess the authority to enter into an agreement that would bind future Boards of Directors. North Farm, however, contends that the rule BCWA relies upon only applies to contracts involving the performance of a governmental function. Our Supreme Court has long held that "furnishing water" is not a governmental function. Hall, 46 R.I. 230, 142 A. at 158. Moreover, the Court has continued to cite its decision in Hall for that proposition. See Housing Auth. of City of Providence v. Oropeza, 713 A.2d 1262, 1264 (R.I. 1998); Lepore v. R.I. Pub. Transit Auth., 524 A.2d 574, 575 (R.I. 1987). In addition, the Court in NELS indicated that it has "recognized that a governmental entity can exercise both governmental and proprietary functions." 550 A.2d at 627. Here, while BCWA may be delegated some governmental powers, e.g., condemnation power and the power to issue bonds, the issue before the Court is whether the "particular facet" of BCWA's operations in connection with North Farm was proprietary. Id. Accordingly, the Court finds that BCWA's operations at issue here, namely the furnishing of water to North Farm, is proprietary.
The Court now turns to the requested preliminary injunction. As outlined above, the Court must consider four factors when considering a preliminary injunction. The primary factor at issue in the instant action is the first prong of the analysis, namely "whether the moving party has a reasonable likelihood of success on the merits." Further, also stated above, the standard is simply whether the moving party has established a prima facie case.
The particular facet of BCWA's operations at issue here concerns the furnishing of water to the North Farm condominium complex. Accordingly, BCWA is engaged in a proprietary function and the agreement is not void simply because it has the effect of binding future Boards of Directors. The Court recognizes that there may be a question as to whether Michael Cooney, the BCWA employee who was involved in discussions with North Farm regarding the central meter, possessed the authority to enter into the agreement. The Court, however, need not resolve this issue at this time. Rather, the Court need simply establish that a prima facie case has been established by which North Farm may succeed at trial. Here, North Farm has adequately pled that an agreement was entered into between it and BCWA and that BCWA has articulated that it intends to breach that agreement. Accordingly, the Court is satisfied that the first prong of the United Way analysis has been fulfilled.
Second, with regard to whether "the moving party . . . will suffer irreparable harm without the requested injunctive relief," the Court finds that the necessary construction and renovation to update the original pits to regular working order in compliance with modern safety standards would constitute irreparable harm to North Farm. The Court, therefore, finds the second prong to be satisfied. Third, in balancing the equities, the Court finds that the potential hardship to North Farm in adjusting to individual metering during the course of this litigation outweighs the potential hardship to BCWA at this time. Finally, the Court finds that a preliminary injunction will uphold the status quo as the current central meter and billing arrangement has been in effect since the mid-1990s.
V Conclusion
For the foregoing reasons, the Court finds that Plaintiff has shown the necessary requirements for the issuance of a preliminary injunction. Accordingly, the Court grants Plaintiff's motion for preliminary injunction and denies Defendant's motion to dismiss Count III of Plaintiff's Complaint.
Prevailing counsel shall present an appropriate order consistent herewith which shall be settled after due notice to counsel of record.