In re Weisel, 06-25304-TPA.

• Decision Date: 09 February 2009
• Docket Number: No. 06-25304-TPA.,No. 08-2195-TPA.,06-25304-TPA.,08-2195-TPA.
• Citation: 400 B.R. 457
• Parties: In re Michael WEISEL and Lori Sue Weisel, Debtors. Michael Weisel and Lori Sue Weisel, Plaintiffs, v. Dominion Peoples Gas Company, Defendant.
• Court: U.S. Bankruptcy Court — Western District of Pennsylvania

Page 457

400 B.R. 457

In re Michael WEISEL and Lori Sue Weisel, Debtors.

Michael Weisel and Lori Sue Weisel, Plaintiffs, v. Dominion Peoples Gas Company, Defendant.

Bankruptcy No. 06-25304-TPA.

Adversary No. 08-2195-TPA.

United States Bankruptcy Court, W.D. Pennsylvania.

February 9, 2009.

David A. Colecchia, Greensburg, PA, for Plaintiff.

John P. Vetica, Jr., Moon Township, PA, for Defendant.

MEMORANDUM OPINION AND ORDER

THOMAS P. AGRESTI, Bankruptcy Judge.

Currently pending before the Court is the Motion for Summary Judgment filed by Movant, Dominion Peoples Gas Co. ("Dominion"), at Document No. 23 ("Motion"). The issue in this case is whether a residential natural gas utility, Dominion Peoples Gas Company, can unilaterally terminate gas service to the Chapter 13 Debtors' home based on postpetition, unpaid bills, or whether it was first required to seek relief from stay or an increased adequate assurance payment requirement from this Court. For reasons explained in detail below, the Court finds that under the facts of this case, Dominion was not required to obtain any type of relief from the Court before terminating the Debtors' gas service based on the described postpetition deficiencies. Accordingly, summary judgment will be granted in favor of Dominion.¹

FACTS AND PROCEDURAL HISTORY

Debtors filed their Chapter 13 petition on October 26, 2006, listing an unsecured, non-priority debt owed to Dominion in the amount of $1,203.40 for pre-petition utility services. Debtors filed their proposed Plan on November 13, 2006, with $1 devoted to general, unsecured creditors. See Document No. 7. On December 21, 2006, the Plan was confirmed on an interim basis. On March 15, 2007, the Plan was finally confirmed with a monthly Plan payment requirement of $1,540.²

On April 30, 2008, Debtors initiated the instant matter by filing an Expedited Complaint for Violation of the Automatic Stay ("Complaint") against Dominion. The Complaint alleged that on April 9, 2008, Dominion terminated Debtors' gas service without first having obtained relief from stay. Debtors characterized Dominion's actions as "illegal" in that such conduct constituted a violation of the automatic stay and an attempt to exercise "dominion and control" over property of the bankruptcy estate, i.e., the Debtors' wages and home. Complaint ¶ 10. Debtors asked the Court to find that Dominion violated the stay, to order gas service restored, and to award attorney fees, actual damages, and punitive damages. On May 1, 2008, the Court entered an Order scheduling a hearing for May 6, 2008.

At the scheduled hearing no representative of Dominion appeared apparently due to the failure of Debtors' Counsel to make proper service as required in the May 1 2008 Order. Nevertheless, based on the allegations in the Complaint and the perceived exigency of the circumstances, the Court entered an interim order that required Dominion to immediately restore gas service to the Debtors until further order and scheduled a preliminary hearing on the Complaint for May 21, 2008. See Document No. 6.

At the May 21st preliminary hearing both Parties were represented. Debtors' Counsel reported that the gas had been turned back on as ordered. He proposed that an amended Plan be filed increasing the amount of the Plan payment to take care of the then-accumulated postpetition arrearage owed to Dominion. Debtor husband was present and affirmed his ability to pay an extra $200 to $225 per month for that purpose. There also was an issue raised as to whether Dominion had followed the proper procedure under applicable Pennsylvania public utility law to effect termination of the gas service. Debtors' counsel questioned whether the notices required by state law had been sent out by Dominion prior to the shut-off. Dominion's attorney stated that the postpetition balance due was $1,157.09. He said default notices were sent out in February and March of 2008 before the gas was turned off in April. He also said Dominion was willing to work on a payment plan with the Debtors.

Based on the representations made at the preliminary hearing on May 28, 2008, the Court issued a Pretrial Scheduling Order confirming the Parties' agreement that the only issue in the case was the legal one of whether Dominion had appropriately complied with its duties under 11 U.S.C. § 366 before it terminated the gas service. See Document No. 16. The Order noted that the Parties had therefore agreed to present the matter to the Court by stipulation, with one exception, that is, Debtors disputed they had ever received prior notice of Dominion's intent to terminate service. Dominion was thus to provide copies of the notices to the Debtors but no further discovery was contemplated. All preliminary motions, including any motions for summary judgment, were to be filed by June 24, 2008. The Court also ordered Debtors to pay $200 to their attorney each month toward postpetition utility arrearages underlying the purpose for originally filing the Complaint and to be held by him pending further Order of Court.

On June 23, 2008, Dominion filed its Motion with an accompanying Memorandum of Law and an Affidavit signed by Pamela Swansey, the Credit Administrator for Dominion, along with extensive attached exhibits. On July 12, 2008, the Parties filed a Consolidated Pretrial Statement, Document No. 35, setting forth a fairly extensive listing of facts upon which the Parties agreed. On August 3, 2008, the Debtors filed a Response to the Motion, as well as a Memorandum in opposition to the Motion. See Document Nos. 50, 56. Further demonstrating the lack of any significant factual dispute, the Debtors' Response admitted 35 of the 37 paragraphs set forth in the Motion, the only exceptions being Paragraphs 2 and 3 of the Motion which set forth the legal relief being sought by Dominion.³

The agreed upon facts of this case are not complicated. Prior to the bankruptcy the Debtors had an account with Dominion, Account No. 7460601283662 ("Prepetition Account"), for gas services to their residence in Latrobe, Pennsylvania. After the Debtors filed their bankruptcy petition on October 26, 2006, Dominion closed the Prepetition Account so that all utility charges prior to the petition date were included therein. Dominion was authorized to do so pursuant to the "Dominion Rates and Rules" that govern the relationship between Dominion and its customers, See Swansey Affidavit, Ex. A-2, ¶ 6, Document No. 23. The Debtors have not challenged Dominion's actions in that regard. Thereafter, Dominion continued service to the Debtor postpetition, opening a new account with the Debtors, Account No. 7500030687738 ("Postpetition Account"), which started with a $0 balance as of the petition date. Debtors took no steps to furnish adequate assurance of payment to Dominion during the 20 day period after filing their petition. On November 18, 2006, Dominion mailed a letter to the Debtors seeking a $217 postpetition deposit to be paid by December 22, 2006, due to the bankruptcy filing. Swansey Affidavit, Ex. A-4, Document No. 23. The Debtors tendered a $215 postpetition deposit that was received and accepted by Dominion on December 18, 2006 and held in the Postpetition Account. No Court involvement took place concerning the creation of the postpetition deposit between Dominion and the Debtors.

Aside from their submission of the deposit, payments by the Debtors to Dominion on the Postpetition Account were sporadic and delinquent from the start. The details are spelled out in the facts to which the Parties have stipulated and need not be repeated here. By October 2007 the Debtors' delinquency on the Postpetition Account had reached over $ 800. In addition to the normal, October bill, Dominion also mailed the Debtors a "10-Day Residential Shut-Off Notice" warning them that their service could be shut off by October 30, 2007, unless the bill was paid or payment arrangements were made. Dominion also attempted to contact the Debtors by phone on October 19, 2007, leaving a message on their answering machine. A similar notice was sent and two more phone calls were made in November 2007. Despite these actions the Debtors' delinquency on the Post-petition Account continued to climb. In February and March 2008, Dominion again sent 10-Day Residential Shut-Off Notices to the Debtors and made efforts to contact them by telephone. Dominion terminated gas service to the Debtors on April 9, 2008, for non-payment. A few weeks later, the Debtors filed the Complaint.

SUMMARY JUDGMENT STANDARD

For purposes of resolving a summary judgment motion, Fed.R. Civ.P. 56 is made applicable to adversary proceedings through Fed.R.Bankr.P. 7056. Summary judgment is appropriate if the pleadings, depositions, supporting affidavits, answers to interrogatories and admissions that are part of the record demonstrate that there exists no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed.R. Civ.P. 56(c), Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Summary judgment is appropriate if no material factual issue exists and the only issue before the Court is a legal issue. EarthData Int'l of N.C., L.L.C. v. STV, Inc., 159 F.Supp.2d 844 (E.D.Pa.2001); In re Air Nail Co., Inc., 329 B.R. 512 (Bankr. W.D.Pa.2005). The test under Fed.R. Civ.P. 56 is "whether the moving party is entitled to judgment as a matter of law." Med. Protective Co. v. Watkins, 198 F.3d 100, 103 (3d Cir.1999) (quoting Armbruster v. Unisys Corp., 32 F.3d 768, 777 (3d Cir.1994)). In deciding a motion for summary judgment, the Court must construe the facts in a light most favorable to the non-moving party. United States v. Isley, 356 F.Supp.2d 391 (D.N.J.2004). Once the moving party satisfies its burden of establishing a prima facie case for summary judgment, the non-moving party must do more than raise some metaphysical doubt as to material facts. Boyle...