Fox Ridge Village, LP v. PUC, 854 C.D. 2020

Background

Fox Ridge Village, LP (Developer) and Pennsylvania-American Water Company (PAWC) executed a 2017 line-extension Agreement requiring Developer to construct water facilities; PAWC retained exclusive control over size/type of mains and required PAWC-approved vendors and specifications.
Phase II lots above 1,220 ft needed a booster pump station (two domestic pumps + one fire pump) and a diesel standby generator to provide adequate pressure/flow for domestic service and fire protection.
Developer engaged a non‑approved vendor (Dakota) and proposed electric substations instead of the diesel generator; PAWC refused to accept the facilities and to provide service until an acceptable booster/generator were installed.
October 2017 pressure/flow testing (including Township Fire Department) showed low residual pressure (0–12 psi at top-of-hill) and insufficient fire flow; PAWC initially withheld service for safety/adequacy reasons but later accepted facilities and began service in early 2018 after required equipment installed.
Procedural history: Developer sued in trial court; PAWC filed a declaratory petition with the PUC. At a March 19, 2019 PUC hearing Developer’s counsel left and offered no evidence. The ALJ held PAWC complied with the Public Utility Code, PUC regulations, and its tariff; the PUC adopted the ALJ decision, and Commonwealth Court affirmed.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Enforceability of alleged oral settlement agreement	Developer: Parties reached an oral/written settlement Dec. 1–6, 2017 that the PUC/ALJ should enforce	PAWC/PUC: No meeting of minds; no terms placed on record; PAWC denied any settlement	No enforceable settlement; record lacks proof and ALJ properly declined enforcement or further evidentiary hearing after Developer failed to present evidence
Mootness / jurisdiction (case or controversy)	Developer: PAWC later accepted facilities and began service, so controversy is moot and PUC lacks jurisdiction	PAWC/PUC: Dispute over propriety of initial refusal remained; Developer continued litigation, so controversy persisted	Not moot; PUC properly exercised discretion to issue declaratory relief because controversy and uncertainty remained
Whether PAWC lawfully refused acceptance/service	Developer: PAWC exceeded tariff/agreement and improperly refused to accept facilities or serve Phase II	PAWC: Refusal was necessary to ensure adequate, safe, and reasonable service under Code, regulations, and its tariff	PAWC acted reasonably and complied with Code, PUC regulations, and tariff due to inadequate pressure/flow shown by testing
ALJ’s procedural rulings (denial of transfer / proceeding with hearing)	Developer: ALJ should have transferred to trial court or held hearing on settlement existence; hearing improper	PAWC/PUC: ALJ acted within discretion; Developer waived opportunity by not presenting evidence and by counsel leaving hearing	No error: ALJ and PUC did not abuse discretion; Developer forfeited opportunity to present evidence and appeal was interlocutory when filed

Key Cases Cited

Mazzella v. Koken, 739 A.2d 531 (Pa. 1999) (settlement enforceability under contract‑law principles; meeting of the minds required)
Muhammad v. Strassburger, 587 A.2d 1346 (Pa. 1991) (elements of a valid settlement/contract: offer, acceptance, consideration)
DeLuca v. Mountaintop Area Joint Sanitary Auth., 234 A.3d 886 (Pa. Cmwlth. 2020) (oral settlement enforceable when terms placed on record and parties confirm understanding)
Funk v. Wolf, 144 A.3d 228 (Pa. Cmwlth. 2016) (declaratory judgment requires a real, actual controversy)
Ruszin v. Dep’t of Labor & Indus., 675 A.2d 366 (Pa. Cmwlth. 1996) (case/controversy requires antagonistic claims and imminent litigation)
Germantown Cab Co. v. Pa. Pub. Util. Comm’n, 97 A.3d 410 (Pa. Cmwlth. 2014) (review of PUC discretionary declaratory orders limited to abuse of discretion)
Chester Water Auth. v. Pa. Pub. Util. Comm’n, 868 A.2d 384 (Pa. 2005) (scope of appellate review of PUC actions)