Fourth Department Finds Payment Agreement Signed Under Duress After Water Service was Shut Off Does Not Bar Suit to Recover Disputed Charges

On March 26, 2010, the Appellate Division, Fourth Department, upheld a lower court's award of damages to customers of the Erie County Water Authority in an action to recover excess water charges. The water authority argued that the customers could not sue because they agreed to pay the charges in installments under a written payment plan, after the water service was shut off in an effort to collect the disputed charges. The court stated:

Defendant [Erie County Water Authority] appeals from an order that modified a judgment of City Court in this small claims action by awarding plaintiffs additional damages for payments made on excess water bills during the period of February 2005 to May 2006.
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Finally, contrary to defendant’s contention, the payments made by plaintiffs pursuant to the parties’ delinquent account payment agreement may be recovered inasmuch as plaintiffs executed that agreement when they were under duress based on defendant’s conduct in shutting off the water supply to their home (see generally Adrico Realty Corp. v City of New York, 250 NY 29, 33- 34).

Gruber v. Erie County Water Authority, __ A.D.3d __ (4th Dept. March 26, 2010, slip opinion at 2).