CALLAREMI CADILLAC BUICK GMC, INC. VS. JERSEY CENTRAL POWER AND LIGHT COMPANY (NEW JERSEY BOARD OF PUBLIC UTILITIES)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-3977-19
CALLAREMI CADILLAC
BUICK GMC, INC.,
Petitioner-Appellant,
v.
JERSEY CENTRAL POWER
AND LIGHT COMPANY,
Respondent-Respondent.
__________________________
Submitted October 14, 2021 – Decided November 19, 2021
Before Judges Hoffman, Whipple and Geiger.
On appeal from the New Jersey Board of Public
Utilities, Docket No. EC19090999.
Noel E. Schablik, attorney for appellant.
Connell Foley, LLP, attorneys for respondent Jersey
Central Power and Light Company (Leo J. Hurley, Jr.,
of counsel and on the brief).
Andrew J. Bruck, Acting Attorney General, attorney for
respondent New Jersey Board of Public Utilities
(Sookie Bae-Park, Assistant Attorney General, of
counsel; Terel L. Klein, Deputy Attorney General, on
the brief).
PER CURIAM
Petitioner Callaremi Cadillac Buick GMC, Inc. appeals from a final
decision of the Board of Public Utilities (the Board) adopting the initial decision
of the Administrative Law Judge (ALJ), denying petitioner's motion for
summary decision and granting respondent Jersey Central Power and Light
Company's cross-motion for summary decision. Respondent incorrectly
calculated petitioner's electric usage by using an improper meter constant.
Respondent sought to make a retroactive billing adjustment to reflect the correct
meter constant. Petitioner contested the billing adjustment. The Board
concluded that petitioner "failed to bear its burden of proof . . . that it was
improperly billed" by respondent and dismissed its petition. We affirm.
I.
We ascertain the following facts from the record. Petitioner operates a
retail new car dealership on Route 46 in Mount Olive Township, Morris County.
Petitioner has been a non-residential electric service customer of respondent
since September 1974.
From June 2009 through February 2019, electric usage at petitioner's
property was measured by electric meter S07018655 (the old meter). In
A-3977-19
2
February 2019, the old meter was replaced with meter S322924098 (the new
meter) as part of a scheduled replacement. The new meter is the same type of
meter as the old meter.
In an affidavit, Doug Meneeley, a distribution technician in respondent's
meter services department, explained that respondent calculates a customer's
electric usage by taking the usage registered by the meter during the billing
period and multiplying that number by the appropriate "meter constant" for that
type of meter. According to Meneeley,
A meter constant is a number used in the calculation of
a customer's usage in certain circumstances based on
the configuration of the customer’s electric service. A
meter constant is necessary when the amount of energy
is too large to be registered on a meter display. . . . The
meter constant for the current transformers remains the
same regardless the specific electric service meter in
use, so long as the type of meter is the same.
Meneeley further explained that, to determine a customer's actual usage
for billing purposes, respondent must subtract the number displayed on the
customer's meter at the end of the billing period from the number displayed on
the customer's meter at the end of the prior billing period, and then multiply the
resulting number by the meter constant.
The meter constant that respondent used to calculate petitioner's electric
usage since at least March 2013 was thirty. In February 2019, the electric meter
A-3977-19
3
at petitioner's property was audited pursuant to a meter work notification. The
audit revealed that the appropriate meter constant was actually forty. On March
6, 2019, a supervisor visited the property and verified that respondent had used
the wrong meter constant to calculate petitioner's electric bill since at least
March 2013.
On March 25, 2019, respondent tested the old meter. The old meter tested
within the accuracy parameters required by the Board. The parties agree that
petitioner did not tamper with the old meter during the service period at issue.
As a result of the incorrect meter constant that respondent used to
calculate petitioner's electric usage, petitioner had been under-billed for electric
service. On April 23, 2019, respondent informed petitioner that it would be re-
billing petitioner for electric service to recover some of the losses it incurred
from using the incorrect meter constant.
On April 29, 2019, respondent sent petitioner an invoice containing a
billing adjustment, after applying the correct meter constant. The total
adjustment was $33,467.65. Including other adjustments and the account
balance prior to adjustment, petitioner's total account balance was $34,742.16. 1
1
On September 19, 2019, respondent issued a revised invoice in the amount of
$38,256.70. The revised amount reflected the amounts owed for electric service
A-3977-19
4
Thereafter, petitioner filed a verified petition against respondent,
challenging the legality of respondent's billing adjustment. On October 7, 2019,
respondent filed a verified answer, asserting that Section 3.06 of its tariff
authorized it to make the retroactive billing adjustment. In its reply to
respondent's verified answer, petitioner asserted that respondent is barred from
making the billing adjustment under N.J.A.C. 14:3-4.6(d). On October 23, 2019,
the Board transmitted the matter to the Office of Administrative Law as a
contested case.
The parties then filed cross-motions for summary decision. On March 5,
2020, an ALJ denied petitioner's motion for summary decision and granted
respondent's cross-motion for summary decision. The ALJ concluded that
N.J.A.C. 14:3-4.6(d) does not govern this case because the meter did not fail to
register 100 percent of service. Rather, respondent "simply undercharged
[petitioner] because [respondent] applied the wrong meter constant, that is,
[respondent] applied a meter constant of [thirty] instead of a meter constant of
[forty] in the billing calculation, for which it seeks a billing adjustment." The
provided by three different third-party suppliers that provided electric service to
petitioner during the six-year re-bill period. The bill included the following
amounts: $4,397.62 for services provided by JCP&L; $12,421.40 for services
provided by Hudson Energy Services; and $21,437.68 for services provided by
Direct Energy Business, LLC.
A-3977-19
5
ALJ concluded that, under Section 3.06 of respondent's Tariff for Service,
respondent is authorized to make the billing adjustment under Section 3.06's
"any other legitimate reason" clause, which allows re-billing for adjustments
dating back up to six years.
On May 20, 2020, the Board adopted the ALJ's initial decision as its final
agency decision. The Board concluded that N.J.A.C. 14:3-4.6(d) does not
govern this case because "[t]his is not a case where a meter has been found to
be registering less than 100 percent of service." The Board determined that
"[t]he billing discrepancy was caused not by a faulty meter, but by multiplying
the meter's measurement by an incorrect meter constant." The Board accepted
the ALJ's determination that the "any other legitimate reason" clause in Section
3.06 of respondent's tariff applies in this case and authorizes the billing
adjustment. The Board therefore adopted the ALJ's initial decision as its final
decision and dismissed petitioner's case. This appeal followed.
II.
Our review of an agency's final administrative determination is limited.
In re Carter, 191 N.J. 474, 482 (2007). Such determinations are not overturned
"in the absence of a showing that it was arbitrary, capricious or unreasonable,
or that it lacked fair support in the evidence." Ibid. (quoting Campbell v. Dep't
A-3977-19
6
of Civ. Serv., 39 N.J. 556, 562 (1963)). In reviewing an agency's final
determination, we review:
(1) whether the agency's action violates express or
implied legislative policies, that is, did the agency
follow the law; (2) whether the record contains
substantial evidence to support the findings on which
the agency based its action; and (3) whether in applying
the legislative policies to the facts, the agency clearly
erred in reaching a conclusion that could not reasonably
have been made on a showing of the relevant factors.
[Mazza v. Bd. of Trs., 143 N.J. 22, 25 (1995) (citation
omitted).]
An appellate court is "in no way bound by the agency's interpretation of a
statute or its determination of a strictly legal issue." Mayflower Sec. Co. v.
Bureau of Sec., 64 N.J. 85, 93 (1973). However, "[a]n administrative agency's
interpretation of a statute it is charged with enforcing is entitled to great weight."
In re Saddle River, 71 N.J. 14, 24 (1976) (citation omitted). Moreover, we give
great deference to an agency's "interpretation and implementation of its rules
enforcing the statutes for which it is responsible." In re Freshwater Wetlands
Prot. Act Rules, 180 N.J. 478, 489 (2004). "Where an agency's expertise is a
factor, a court defers to that expertise, particularly in cases involving technical
matters within the agency's special competence." In re Adoption of Amends. to
Ne., Upper Raritan, Sussex Cty., 435 N.J. Super. 571, 583 (App. Div. 2014).
A-3977-19
7
Petitioner contends that N.J.A.C. 14:3-4.6(d) forbids respondent from
retroactively adjusting petitioner's charges for electric service. Petitioner argues
that the meter "registered less than 100 percent of the service provided" because
the meter constant is a component of the meter, which, if not correctly
calibrated, can skew the meter reading. Petitioner further contends that the
purpose of the regulation is to "shield[] the customer from retroactive re -billing
where the customer did nothing to contribute to the billing error."
Respondent argues that N.J.A.C. 14:3-4.6(d) does not apply because the
meter did not register less than 100 percent of the service provided. Respondent
notes that the meter was tested and found to be "garnering accurate readings
within the required accuracy parameters set by the Board." Respondent further
notes that the meter constant "has nothing to do with the meter's functionality."
Rather, it is a number used to calculate electric usage in the billing process.
N.J.A.C. 14:3-4.6(d) provides:
(d) If a meter is found to be registering less than 100
percent of the service provided, the utility shall not
adjust the charges retrospectively or require the
customer to repay the amount undercharged,
except if:
1. The meter was tampered with, or other theft
of the utility service has been proven;
2. The meter failed to register at all; or
A-3977-19
8
3. The circumstances are such that the
customer should reasonably have known that
the bill did not reflect the actual usage.
[N.J.A.C. 14:3-4.6(d).]
The traditional rules of statutory interpretation apply when interpreting a
regulation. See J.H. v. R & M Tagliareni, LLC, 239 N.J. 198, 214 (2019). "[A]
regulation should be construed in accordance with the plain meaning of its
language and in a manner that makes sense when read in the context of the entire
regulation." Ibid. (quoting Medford Convalescent & Nursing Ctr. v. Div. of
Med. Assistance & Health Servs., 218 N.J. Super. 1, 5 (App. Div. 1985)).
In interpreting a statute, the court first looks to the language of the statute.
State v. Butler, 89 N.J. 220, 226 (1982). "If the statute is clear and unambiguous
on its face and admits of only one interpretation, we need delve no deeper than
the act's literal terms to divine the Legislature's intent." Ibid. The court does
not add terms which may have been intentionally omitted by the legislature, nor
does the court "speculate or otherwise engage in an interpretation which would
avoid [the statute's] plain meaning." Sterling Laurel Realty, LLC v. Laurel
Gardens Co-Op, Inc., 444 N.J. Super. 470, 476 (App. Div. 2016).
The plain language of N.J.A.C. 14:3-4.6(d) reveals that it applies where
"a meter is found to be registering less than 100 percent of the service provided
A-3977-19
9
. . . ." Here, the meter was not inaccurate. The meter measured all service
respondent provided. Respondent merely used the incorrect meter constant in
calculating petitioner's electric bill, resulting in the under-billing at issue.
We next consider whether the Board erred in concluding that respondent
Section 3.06 permitted respondent to make the billing adjustment. Respondent
contends that Section 3.06 is broader than N.J.A.C. 14:3-4.6(d) because it allows
a billing adjustment brought "for any other legitimate reason" instead of
requiring an inaccurate meter. We agree.
Prior to offering utility services to the public, each public utility must
submit a tariff to the Board for approval. N.J.A.C. 14:3-1.3(a); see also N.J.A.C.
48:2-21. "A tariff is a published schedule of rates, filed by a public utility, and
thereafter, in the absence of successful challenge, applicable equally to all
customers." Saddle River, 71 N.J. at 29. "[A] tariff is not a mere contract. It is
the law, and its provisions are binding on a customer whether he knows of them
or not." Ibid.Section 3.06 of respondent's tariff provides:
Billing Adjustments: An adjustment of charges due to
the Company for Services provided by the Company
will be made when a meter fails to register within the
limits of accuracy prescribed by the [Board of Public
Utilities] in accordance with [N.J.A.C.] 14:3-4.6, or for
any other legitimate reason, in which case such
A-3977-19
10
adjustment shall not be for a period of more than six
years prior to the time the reason of the adjustment
became known to the Company.
Here, the ALJ and the Board both found that respondent sought to make
the billing adjustment for a legitimate reason – to apply the correct meter
constant. The Board promulgated subchapter four to ensure that "metered
customers will pay for what they receive and utilities will be compensated for
what they provide." 28 N.J.R. 1810(a) (April 1, 1996). Bearing in mind the
deference given to the Board's "interpretation and implementation of its rules
enforcing the statutes for which it is responsible," Freshwater Wetlands, 180
N.J. at 489, we conclude the Board reasonably found that Section 3.06 allowed
respondent to make the challenged billing adjustment.
Affirmed.
A-3977-19
11