Con Edison v. Paul Schultz, 48 N.Y.2d 925 (1979)
A utility company is entitled to recover for services used when a customer’s electric meter has been tampered with, even if the utility cannot prove who caused the tampering, but the amount of damages must be properly determined.
Summary
This case addresses the issue of liability and damages when an electric meter has been tampered with, and the customer is aware of the tampering. The New York Court of Appeals held that Consolidated Edison (Con Edison) was entitled to recover for the electricity used by the customer (Schultz), regardless of who caused the tampering, because the customer was aware of the situation. However, the Court also found that there was a triable issue of fact regarding the calculation of damages, necessitating a new trial on that specific issue.
Facts
Paul Schultz’s electric meter was tampered with. Con Edison claimed Schultz was aware of the tampering. Con Edison brought a counterclaim to recover for the electricity Schultz actually used during the period of the tampering. The test period Con Edison used to estimate damages was at the end of the five-year period during which the meter malfunctioned and was atypical. Schultz’s store hours were 50% greater and the area to be lighted increased eightfold from the beginning to the end of the period.
Procedural History
Con Edison brought a counterclaim against Schultz. Schultz demanded a jury trial, and Con Edison did not object, thus agreeing to a jury determination of the amount owed. The lower court directed judgment for Con Edison. The Appellate Division affirmed the judgment regarding liability but modified it concerning damages. The Court of Appeals then reviewed the Appellate Division’s decision.
Issue(s)
Whether Consolidated Edison is entitled to recover for services actually used by plaintiff when the plaintiff’s electric meter was tampered with, regardless of who caused the tampering, if the plaintiff was aware of the tampering. Whether there was a triable issue for the jury concerning the amount of damages owed to Consolidated Edison.
Holding
1. Yes, because it was undisputed that the plaintiff’s electric meter was tampered with and that the plaintiff was aware of that fact, Consolidated Edison was entitled to recover for the service actually used by the plaintiff, without regard to who caused the tampering.
2. Yes, because there was a triable issue for the jury concerning the amount of damages due to the propriety of the test period used which was at the end of the five-year period during which the meter functioned improperly and was atypical.
Court’s Reasoning
The Court reasoned that because Schultz knew about the tampering, Con Edison was entitled to compensation for the services used, regardless of who was responsible for the tampering. The Court highlighted paragraph 18 of Con Edison’s counterclaim as sufficient pleading for recovery under this theory. The Court found no triable issue regarding liability because the evidence established Schultz’s awareness.
However, the Court found a triable issue concerning the amount of damages. Schultz demanded a jury trial on the counterclaim, and Con Edison consented by failing to object. The Court noted the test period used to calculate damages was problematic because it occurred at the end of the five-year period of meter malfunction and was atypical due to increased store hours and expansion of the store’s area. Because of these factors affecting electricity usage during the test period, the Court deemed a jury trial necessary to determine the proper amount of damages. The Court stated, “There clearly was a triable issue for the jury concerning amount of damages: the propriety of the test period used which was at the end of the five-year period during which the meter functioned improperly and was atypical, according to plaintiff’s testimony, both as to time (hours the store was open were 50% greater than the rest of the year) and area to be lighted (from the beginning to the end of the period the area of the store increased eightfold).”