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Yardville Estates Inc. v. City of Trenton

Decided: February 28, 1961.

YARDVILLE ESTATES, INC., A CORPORATION OF NEW JERSEY, PLAINTIFF-APPELLANT,
v.
CITY OF TRENTON, A MUNICIPAL CORPORATION OF THE STATE OF NEW JERSEY, DEFENDANT-RESPONDENT



Goldmann, Foley and Fulop. The opinion of the court was delivered by Fulop, J.c.c. (temporarily assigned).

Fulop

This is an appeal from a judgment of the Chancery Division denying the plaintiff the right to recover the cost of water mains installed by plaintiff to connect its development in the Township of Hamilton with the water distribution system of the defendant City of Trenton.

The City of Trenton has owned a public water supply system since about 1859. Goldmann, History of Trenton (Trenton Historical Society). Prior to 1941, the city extended water service to parts of the adjacent Townships of Hamilton, Ewing and Lawrence. By resolution of February 6, 1941, the Board of Commissioners of Trenton laid down a policy with respect to the further extension of water mains in these townships. Under this resolution, main feeder lines were to be laid by the city at its own expense. The city also undertook to extend water lines for new developments at the rate of 1,000 feet of main for each 14 houses. For fewer houses or greater distances, the owner was to pay in advance the cost of the mains.

This resolution was rescinded by a new resolution dated June 4, 1953, setting a new policy requiring all owners, developers and builders in the townships to install water main extensions and related connections at their own expense, or to pay for them if installed by the city. The resolution recites the extensive development of tracts of land in these municipalities and that "it has become an unbearable financial burden for the City of Trenton to continue water main extensions," etc.

Thereafter the city recognized and performed all commitments for extensions made prior to the adoption of the 1953 resolution. Applications for extensions made after June 4,

1953 were granted only upon the terms of the resolution of that date. The performance of prior commitments, the laying of new trunk lines and other enlargements and improvements of the system were covered by a series of ordinances and bond issues, involved large expenditures of money on the part of the city, and have taken a number of years to complete. Some were not completed at the time of the trial of this case.

In 1954 plaintiff negotiated with the superintendent of the water works for the extension of mains to a proposed development of dwelling houses in Hamilton Township. Its representatives were informed of the terms imposed by the 1953 resolution and that plaintiff would be required to install the mains at its own expense. Plaintiff agreed to and did lay the mains at a cost of $44,667. It built and sold 263 dwelling houses supplied with water by this means.

These mains were installed between November 1954, and June 1955. During the summer of 1955 plaintiff's representatives discussed with the superintendent of the water works the possibility of obtaining reimbursement from the city for all or part of the cost of installing the mains. He told them that the city planned to apply to the Board of Public Utility Commissioners for an increase in water rates and suggested that plaintiff might obtain reimbursement by application to that board. Plaintiff made no such application. The water rates were increased effective October 1, 1956.

The present action sought specific performance of an alleged agreement to reimburse plaintiff, for an accounting of water revenues from the houses constructed by plaintiff, and other ancillary relief. In short, plaintiff sought to compel defendant to repay to plaintiff out of water revenues all or a substantial part of the cost of the installation of the mains, under a formula applied to privately owned water utilities by the Board of Public Utility Commissioners. Relief was denied after a full trial in the Chancery Division. Since no question is raised with respect thereto, we

express no opinion as to the propriety of bringing this type of action in that court.

The trial judge held that there had been no agreement by defendant to reimburse the plaintiff for the cost of the water mains. We agree with that finding of fact. The discussions of reimbursement were held after installation of the mains had been completed or nearly so. There was no promise of reimbursement by anyone. In any event, any statement on the subject that might have been made by the superintendent of the water works would have been contrary to the policy adopted in the 1953 resolution, was unauthorized by the governing body, and could not bind the city.

However, the plaintiff further contends that:

1) The city discriminated against plaintiff and others in requiring them to pay for their water mains while itself paying for other extensions;

2) The resolution of June 4, 1953 was abandoned or vitiated by the city's subsequent conduct and disregard thereof;

3) The sale of water outside of the City of Trenton is a proprietary function and the city is governed by the law applicable to ...


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