Date Issued: June 11, 2019

File: SC-2018-008792

Type: Small Claims

Civil Resolution Tribunal

Indexed as: Wedgewoods Utilities Inc. v. Pawluck, 2019 BCCRT 711

Between:

Wedgewoods Utilities Inc.

Applicant

And:

Susan Pawluck

Respondent

And:

Wedgewoods Utilities Inc.

Respondent BY COUNTERCLAIM

 

REASONS FOR DECISION
Tribunal Member:	Kate Campbell

INTRODUCTION

1.      This dispute is about payment for water and sewer utilities.

2.      The applicant (and respondent by counterclaim), Wedgewoods Utilities Inc. (Wedgewood), is a privately-owned business licensed by the provincial government to provide water and sewer utility services to property owners. The respondent (and applicant by counterclaim), Susan Pawluck, is a property owner.

3.      Wedgewoods says Ms. Pawluck failed to pay water and sewer fees owed under terms set out in registered charges that appear on the title of her bare land strata lot. It seeks payment of $3,919.20 for these utility fees, plus $287.43 in contractual interest. Wedgewoods also seeks reimbursement of legal fees.

4.      Ms. Pawluck denies Wedgewoods’ claims. In her counterclaim, she seeks reimbursement of $4,875 in legal fees.

5.      Wedgewoods is represented by David Ehrhardt, whom I infer is its principal. Ms. Pawluck is self-represented.

JURISDICTION AND PROCEDURE

6.      These are the formal written reasons of the Civil Resolution Tribunal (tribunal). The tribunal has jurisdiction over small claims brought under section 118 of the Civil Resolution Tribunal Act (Act). The tribunal’s mandate is to provide dispute resolution services accessibly, quickly, economically, informally, and flexibly. In resolving disputes, the tribunal must apply principles of law and fairness, and recognize any relationships between parties to a dispute that will likely continue after the dispute resolution process has ended.

7.      The tribunal has discretion to decide the format of the hearing, including by writing, telephone, videoconferencing, email, or a combination of these. In the circumstances here, I find that I am properly able to assess and weigh the documentary evidence and submissions before me. Further, bearing in mind the tribunal’s mandate that includes proportionality and a speedy resolution of disputes, I find that an oral hearing is not necessary. I also note that in Yas v. Pope, 2018 BCSC 282 at paragraphs 32 to 38, the BC Supreme Court recognized the tribunal’s process and found that oral hearings are not necessarily required where credibility is in issue.

8.      The tribunal may accept as evidence information that it considers relevant, necessary and appropriate, whether or not the information would be admissible in a court of law. The tribunal may also ask questions of the parties and witnesses and inform itself in any other way it considers appropriate.

9.      Under tribunal rule 9.3(2), in resolving this dispute the tribunal may: order a party to do or stop doing something, order a party to pay money, or order any other terms or conditions the tribunal considers appropriate. 

ISSUES

10.   The issues in this dispute are:

a.  Is Wedgewoods entitled to payment of $3,919.20 for water and sewer fees, plus contractual interest?

b.  Is either party entitled to reimbursement of legal fees?

EVIDENCE AND ANALYSIS

11.   In a civil claim such as this, the applicant bears the burden of proof, on a balance of probabilities. This means that Wedgewoods must prove its claims, and Ms. Pawluck must prove her counterclaim. I have only addressed the evidence and arguments to the extent necessary to explain my decision.

12.   Ms. Pawluck says that in January 2016, she bought her bare land strata lot from 28165 Yukon Inc. Ms. Pawluck says, and Wedgewoods does not dispute, that both Wedgewoods and 28165 Yukon Inc. are owned by Mr. Ehrhardt.

13.   Ms. Pawluck’s strata lot is strata lot 3 (SL3), part of a strata corporation legally known as The Owners, Strata Plan BCS 3916, created under the Strata Property Act. There was no house on this lot at the time the dispute was filed, although photos dated February 2019 show that a concrete foundation had been poured and wood framing for a garage had begun.

14.   Wedgewoods says Ms. Pawluck owes $3,919.20 in utilities rent charges for 2017 and 2018. It provided invoices setting out its billing for these amounts. It says the charges are not for utility services used, and does not dispute that there was no completed house on the property during the billing period. Rather, Wedgewoods says the charges are for rent payments owing under water and sewer rent charges registered against the title to Ms. Pawluck’s strata lot.

15.   Documents from the Land Title Office show that the water and sewer rent charges were registered against the title of SL3, as well as other strata lots in the strata, since before Ms. Pawluck purchased it. There are separate rent charges for sewer and water.

16.   The parties agree that the rent charge documents apply to the title of SL3. Ms. Pawluck says she does not owe Wedgewoods any utility fees until her home is connected to the utilities.

17.   Wedgewoods says that SL3 is “connected” to the utilities, as contemplated in the rent charges registered on title, since the water and sewer lines sit within the property lines of the strata lot. Wedgewoods says the rent charge fees therefore apply.

18.   Based on the language of the water and sewer rent charge documents registered on title, I find that Ms. Pawluck owes the amounts claimed by Wedgewoods.

Water

19.   I will first address the water rent charge. The registered rent charge document states as follows in paragraph 2(a) and (b):

(a)  Until such time as the Lot is connected to the Waterworks System, the Lot will be subject to the Annual Fee. The Annual Fee will be payable monthly on the first day of the month…

(b)  From such time as the Lot…is connected to the Waterworks System, the Lot will be subject to the greater of the Annual Fee and the User’s Charge. Such sum will be payable monthly on the first day of the month…

20.   “Lot” is defined in paragraph 1 as “strata lot and premises”. Thus, under the terms of the rent charge, SL3 is subject to a fee regardless of whether it is connected to the waterworks system. If it is not yet connected, the annual fee is payable. If SL3 is connected, then either the annual fee or a (greater) user’s charge is payable. In either scenario, the annual fee is payable as a minimum amount.

21.   The annual fee is set out in a tariff filed with the Comptroller of Water Rights. The tariff was not provided in evidence, but the amount was not contested.

22.   Thus, under the terms of the water rent charge, I find Ms. Pawluck is responsible to pay the annual fees for water for 2017 and 2018, regardless of whether SL3 was connected to the water system. As set out on Wedgewoods’ invoices, these fees total $1,879.20.

23.   The water rent charge also says in paragraphs 1 and 3 that the interest rate for water fees is 18% per annum (year). I find the interest is payable from the date of Wedgewoods’ demand letter of September 19, 2018, as previous invoices did not claim interest. To the date of this decision, this totals $245.58. Thus, I order Ms. Pawluck to pay Wedgewoods $2,124.78 for water fees and interest.

24.   I note that Ms. Pawluck cites a City of Vancouver bylaw regarding utilities fees for lots under construction. However, since SL3 is not in the City of Vancouver, I find that bylaw is not applicable to this dispute, and does not prove the meaning or intention of the rent charge which governs this dispute.

 

Sewer

25.   I also find that Ms. Pawluck must pay Wedgewoods for sewer fees, based on the terms of the sewer rent charge. Paragraph 2 of the sewer rent charge states, in part, as follows:

Each Lot which is connected to the Community Sewer System will be subject to an Annual Fee…

26.   The term “connected” is not defined in the rent charge document. It is undisputed that there was no sewer hooked up to a building or dwelling on SL3 in 2017 or 2018. Again, Wedgewoods says that since the sewer line sits within the boundaries of SL3, it is “connected”.

27.   In support of her argument that SL3 is not connected to the utilities, Ms. Pawluck relies in part on a March 9, 2016 email from Wedgewoods’ bookkeeper, which stated as follows:

It came to my attention that you were charged pro-rated sewer and water fees for 2016. That was incorrect as these fees are chargeable only after you are hooked up to the systems. I have sent you a cheque for refund of these fees.

28.   Wedgewoods did not address the March 9, 2016 email in its submissions, although it does not claim any fees for 2016. Wedgewoods argues that in order to receive government approval to create the bare land strata and register it with the Land Title Office, the owner developer was required to have a civil engineer certify that the strata lots met certain specifications. One specification, as set out in a document entitled, Proposed Subdivision Preliminary Layout Approval, was connection to approved sewer and waterworks systems. Wedgewoods says that since the bare land strata later had its registration approved, this shows that the sewer connection requirement was met. Thus, it says SL3 has been connected to the sewer system since that time, which was before Ms. Pawluck bought it in January 2016.

29.   Wedgewoods provided a December 30, 2018 letter from engineer KH. KH wrote that he was the engineer of record for the development, including establishing the sewer and water systems. KH described the sewer system, and said that as a condition of subdivision, the developer was required to design, get approvals for, build and sign off on the sewer system and connections. KH said that was done. KH also wrote as follows:

Each lot must be Connected to the community sewer and water system to achieve subdivision as defined by the SLRD, Vancouver Coastal Health, CPCN permits and as required by the approving officer. By definition a subdivided lot must be connected to the system. The costs of the system are allocated to all the lots serviced at time of subdivision…

30.   I place significant weight on KH’s opinion, as I accept under tribunal rule 8.3 that he is an expert in the field of civil engineering. Thus, I find his opinion that SL3 is connected to the sewer system persuasive, and I rely on it. I prefer KH’s opinion to that of the bookkeeper, as there is no indication that the bookkeeper ever saw the sewer system, understands its operation, looked at its design specifications, or has experience in construction or municipal development.

31.   Based on KH’s opinion, the Proposed Subdivision Preliminary Layout Approval, and the fact that the strata plan was accepted and registered at the Land Title Office, I accept that SL3 was connected to the sewer system in 2017 and 2018. I therefore find that Ms. Pawluck must pay Wedgewoods the claimed $2,040 in sewer fees.

32.   Wedgewoods claims contractual interest on this amount. Paragraph 4(b) of the sewer rent charge allows interest charges on overdue payment notices. Paragraph 1 defines “Interest Rate” as the rate of interest “specified in a Payment Notice”, not to exceed HSBC bank’s prime rate plus 5% per annum. None of Wedgewoods’ payment notices, labelled “invoices” in the evidence before me, contain any reference to an interest rate. Since the payment notices specify no interest rate, and the sewer rent charge says the interest rate is that specified in the payment notice, I find Wedgewoods is not entitled to contractual interest on the sewer fees.

33.   I find Wedgewoods is entitled to interest on the sewer fees under the Court Order Interest Act (COIA), from the September 19, 2018 date of the demand letter. This equals $25.89.

Legal Fees

34.   Both parties in this dispute claim reimbursement of legal fees. Tribunal rule 9.4(3) says that except in extraordinary cases, the tribunal will not order payment of legal fees in small claims disputes. I see no reason to depart from the general rule in this case, and I find that this dispute is not extraordinary. I therefore do not order any reimbursement of legal fees.

Tribunal Fees and Dispute-Related Expenses

35.   Tribunal rule 9.4 says an unsuccessful party will usually be required to pay the successful party’s tribunal fees and reasonable dispute-related expenses. Wedgewoods was largely successful in this dispute, so I order Ms. Pawluck to reimburse it $175 for tribunal fees. Ms. Pawluck was not successful in her counterclaim, so I dismiss her claim for reimbursement of tribunal fees and dispute-related expenses.

ORDERS

36.   I order that within 30 days of this decision, Ms. Pawluck pay Wedgewoods a total of $4,365.67, broken down as follows:

a.    $2,124.78 for water fees and contractual interest,

b.    $2,040 in sewer fees,

c.    $25.89 in pre-judgment interest under the COIA for the sewer fees, and

d.    $175 as reimbursement of tribunal fees.

37.   Wedgewoods is entitled to post-judgment interest under the COIA, as applicable.

38.   Under section 48 of the Act, the tribunal will not provide the parties with the Order giving final effect to this decision until the time for making a notice of objection under section 56.1(2) has expired and no notice of objection has been made. The time for filing a notice of objection is 28 days after the party receives notice of the tribunal’s final decision.

39.    Under section 58.1 of the Act, a validated copy of the tribunal’s order can be enforced through the Provincial Court of British Columbia. A tribunal order can only be enforced if it is an approved consent resolution order, or, if no objection has been made and the time for filing a notice of objection has passed. Once filed, a tribunal order has the same force and effect as an order of the Provincial Court of British Columbia.