Utility Audit Co. v. City of Los Angeles

This appeal raises two central issues. First, should a refund of improperly collected sewer fees include interest? We hold that it should. Second, does the voluntary payment of such a refund, made without regard to any period of limitations defenses, equal a waiver of such defenses as to the payment of interest? We hold that it does not.

INTRODUCTION

The City of Los Angeles (City) appeals from a judgment entered in favor of Utility Audit Company, Inc. (Utility), in Utility’s consolidated actions to recover interest on refunds paid voluntarily by the City. Utility is the assignee of claims for sewer service fee refunds. The trial court granted summary judgment in the amount of approximately $850,000 in favor of Utility for unpaid interest on the refunds, finding that statutes of limitations and claims filing periods had either been waived or did not apply to bar any portion of the claims. We conclude that the City raised triable issues of fact regarding the application of the statute of limitations and claims filing periods and, accordingly, we reverse.

BACKGROUND

Beginning in 1972, the City assessed sewer service charges against certain property owners who did not use…