State of New York MEMORANDUM
Court of Appeals This memorandum is uncorrected and subject to
revision before publication in the New York Reports.
Herkimer County Industrial
Village of Herkimer,
Charles W. Malcomb, for appellant.
Michael J. Longstreet, for respondent.
The order of the Appellate Division, insofar as appealed from, should be reversed,
with costs, judgment granted in plaintiff’s favor in accordance with this memorandum, and
the certified question answered in the negative.
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In this declaratory judgment action, brought by Herkimer County Industrial
Development Agency (plaintiff), the Village of Herkimer, through a counterclaim, seeks a
judgment declaring that plaintiff is personally liable to the Village for certain unpaid water
rents. The bills were incurred by a manufacturer that was plaintiff’s tenant pursuant to
bond financing sale-and-leaseback transactions. Plaintiff seeks dismissal of the
counterclaim and a declaration that it is not personally liable for the water rents. Judgment
should be granted in plaintiff’s favor.
The Water Department Rules and Regulations of the Village of Herkimer, on which
the Village relies, do not authorize a claim against plaintiff for personal liability upon
nonpayment of water rents. To the extent the Rules and Regulations determine the
Village’s remedies for unpaid water bills, they refer to “a lien on the premises where the
water is used” (Rule No. 8; see also Village Law § 11-1118 [providing that unpaid water
rents constitute a lien on real property]) and to shutting off water supply, upon notice (see
Rule No. 9; see also Village Law § 11-1116 [providing that a village may enforce
observance of its water use rules and regulations by cutting off water supply]). The Village
points in particular to Rule No. 22, but that provision, which is contained in a section
regulating how water meters are used to register consumption, does not impose an
additional remedy for nonpayment.
The Village’s reliance on Dunbar v City of New York (177 App Div 647 [1st Dept
1917], affd 223 NY 597 , affd
251 U.S. 516
) is misplaced. Dunbar held that
a landowner’s consent to the supply of water to a tenant “must be deemed to be made with
a view to the existing law” (id. at 649). Here, the law applicable to the subject property
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provided for a lien upon the real property, and not personal liability by the owner. Dunbar,
therefore, does not support the Village’s assertion that plaintiff is personally liable.
For these reasons, we conclude that plaintiff is not liable for the unpaid water rents.
We need not reach, and take no position on, plaintiff’s alternative argument that it
possessed only a nominal, non-beneficial ownership interest in the property that was so
limited as to defeat any claim of personal liability for the water rents.
Order insofar as appealed from reversed, with costs, judgment granted in plaintiff's favor
in accordance with the memorandum herein and certified question answered in the
negative. Chief Judge DiFiore and Judges Rivera, Stein, Fahey, Garcia and Wilson concur.
Decided March 25, 2021