City of White Plains v. City of New York
| Decision Date | 31 July 1978 |
| Citation | 63 A.D.2d 396,407 N.Y.S.2d 517 |
| Parties | In the Matter of the CITY OF WHITE PLAINS, Respondent, v. The CITY OF NEW YORK et al., Appellants. |
| Court | New York Supreme Court — Appellate Division |
Allen G. Schwartz, Corp. Counsel, New York City (Anthony Z. Scher, Stephen P. Kramer and L. Kevin Sheridan, New York City, of counsel), for appellants.
Paul B. Bergins, Corp. Counsel, White Plains (Paul S. Richmond, of counsel), for respondent.
Before MOLLEN, P. J., and HOPKINS, TITONE and HAWKINS, JJ.
In a proceeding pursuant to CPLR article 78 converted by Special Term into an action for money "had and received", the primary question on appeal is whether the City of New York (New York) was required to audit the claim of the City of White Plains (White Plains) for reimbursement of excess water charges, thereby tolling the six-year Statute of Limitations until the audit was performed.
THE FACTS.
Since 1922, White Plains has purchased water from New York. Rates are fixed by agreement, or, if there is no agreement, by the New York State Department of Environmental Conservation (D.E.C.), successor to the New York State Water Resources Commission, upon application of either party.
From 1938 to the early part of 1967, White Plains paid for its water at an agreed rate of $105.28 per million gallons. However, by letter dated January 27, 1967, New York's Commissioner of the Bureau of Water Supply, Gas and Electricity unilaterally increased the rate to $120 per million gallons, effective February 1, 1967. From February 1, 1967 through December 31, 1971 White Plains paid for the water taken from the New York system at the increased rate, but did so under protest. It should also be noted that on March 6, 1967, the common council of White Plains passed a resolution protesting the rate increase and pointing out that it was contrary to provisions of New York's Administrative Code which prescribed the manner of setting the rates. A certified copy of the resolution was sent to the Mayor of the City of New York and its Commissioner of Water Supply, Gas and Electricity.
In March, 1971 New York made application to the D.E.C. Commissioner to fix the fair and reasonable rate retroactive to February 1, 1967, for water supplied by it to White Plains. By order dated January 31, 1973, the commissioner fixed the rate at $103.72 per million gallons. The rate was not retroactive. (New York appealed from the order, but in May, 1975 the appeal was dismissed by the Appellate Division, Third Department.)
On or about May 29, 1973 White Plains filed a verified claim with New York in the amount of $201,104.46. This sum allegedly represented the total of overcharges for water paid by White Plains between February 1, 1967 and December 31, 1971. On or about June 26, 1973, New York's Office of the Comptroller requested White Plains to provide a detailed itemized statement of its claim. White Plains complied with the request the very next day.
Evidently there was no further contact between the parties until October 22, 1975, when an auditor from New York's Office of the Comptroller inspected the books and records of White Plains relating to its claim. He also made copies of extracts from these books and records which were considered pertinent. New York rejected the claim in September, 1976 and White Plains brought the within proceeding on October 27, 1976. Both sides agree that the amount of the overcharge is $181,834.01 for the period February 1, 1967 to December 31, 1971.
New York asserts that since this proceeding, which was converted by Special Term into an action for money had and received, was not brought until October 27, 1976, part or all of the claim for overcharges paid by White Plains from February 1, 1967 to December 31, 1971 is barred by the six-year Statute of Limitations applicable to an action for money had and received (see CPLR 213; Jandorf v. Freedman & Slater, City Ct., 83 N.Y.S.2d 331; Wilson v. Phelps, 165 Misc. 455, 1 N.Y.S.2d 38). White Plains contends that its cause of action for overpayment accrued in September, 1976 when the audit of the comptroller was completed and the claim was rejected. Hence, since the petition was served on October 27, 1976 the action was timely. Special Term agreed with the position taken by White Plains.
THE LAW.
Under chapter 5 of the New York City Charter, entitled "Comptroller", section 93, which was in effect during the period of this dispute, states in part:
Pertinent provisions of the New York City Administrative Code read as follows:
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