City won't develop legal appeal procedure before April 16 hearing, Shipley assistant claims
By GEOFF DAVIDIAN
Putnam Pit editor
COOKEVILLE (April 10, 2001) -- An aide to City Manager Jim Shipley said Monday the government will not establish an appeal procedure for customers threatened with utility termination until after an April 16 federal court hearing on a temporary restraining order banning the cut offs that District Judge William J. Haynes Jr. signed April 6.

Asked whether the City Council would meet to discuss new rules regarding utility collections, Fowler said, "Not that I know of."

The restraining order, brought in the class action suit Linda Gamble, et .al., v. City of Cookeville, stops Cookeville from shutting off utilities without giving proper notice to customers the city says are late with their payment. Fowler said that because of the federal class action lawsuit brought to stop the city's utility cut off practices, questions regarding an appeal to a termination notice should be addressed to the city's attorney in the case.

Samuel J. Harris, one of the attorneys for plaintiffs Linda Gamble and Ruby Copeland, said he made an offer Monday to City Attorney Mike O'Mara to enter into settlement negotiations, but city apparently has pulled O'Mara off the case after he lost an attempt to block the temporary restraining order in U.S. District Court last week. The city has turned to its sugar daddy, the Tennessee Municipal League's (TML) Risk Management Pool, which provides law firms to defend the city in the countless civil rights suits filed since 1995, when Shipley and O'Mara began calling the shots. Three of those cases go to trial this year, including Holt v. Cookeville, which begins April 30 in Cookeville's federal courthouse.

Elmer Cook, who deals with insurance claims for TML members, said Monday he would not talk to The Pit about anything regarding the utility case, then added that no attorney had been appointed to Gamble v. Cookeville.  However, Fowler contradicted Cook and said questions regarding the case and the utility appeal procedure should be addressed to Cookeville lawyer Daniel H. Rader III, 46 N. Jefferson Ave. Rader's office phone number is 931-526-3311. Rader handles cases for TML member municipalities.

The City and its officials have nothing to lose by fighting the case because the TML's pool spreads the cost among all its member municipalities, allowing Cookeville to drag out litigation at the expense of residents of other cities. In essence, the city has nothing to lose because no individual is accountable and someone else pays the costs. In fact, O'Mara, who should have warned the city about the illegal termination policies, makes money every time the city breaks the law by defending it. Although he has a conflict because what is bad for the city is good for his business, the city continues to rely on his advice, which has cost local taxpayers hundreds of thousands in legal fees.

When The Pit  attempted to determine from the Cookeville Customer Service Department how the city was handling delinquent bills in the interim, the person in charge, Donna Dennis, put us on hold, then transferred our call to City Clerk Stephanie Miller's voice mail. Ms. Miller did not return a call.

O'Mara did not return a call from the Putnam Pit on Monday. An attempt by the Putnam Pit to reach Rader by phone Monday was twice disconnected.

In a memorandum in support of a request for the temporary restraining order, attorneys for plaintiff Gamble wrote:

The delinquent customer is not apprised of any dispute mechanism but is only encouraged to pay or lose utility service. It is no surprise in light of this inadequate notice of an opportunity to be heard on a billing dispute that the City of Cookeville has never held a hearing on a utility bill dispute. (Deposition of Donna Dennis from Hargis vs. AAA Collections, Inc. and City of Cookeville, Tennessee, United States District Court for the Middle District of Tennessee, Case number 2-00-0074, p. 48). Furthermore, the City of Cookeville does not have written policy, ordinance, or "anything" that sets forth utility billing disputes. (Deposition of Donna Dennis, p. 49-50). Therefore customers who wish to dispute utility bills have a limited time without any written procedures to determine a course of action before suffering the irreparable harm of the loss of electricity and water for their family’s households as described in the Verified Complaint and as actually suffered by Linda Gamble and the Copeland family when utilities were terminated at their homes.
It will be up to Judge Haynes to decide whether establishing an appeal procedure that results in disconnects from an attorney's office will meet the due process requirements established by the United States Supreme Court in Memphis Light, Gas & Water Div. v. Craft, 436 U.S. 1 (1978). In Craft, the Supreme Court said the purpose of notice under the Due Process Clause of the Fourteenth Amendment is to apprise the affected individual of, and permit adequate preparation for, an impending "hearing." Notice in a case of this kind does not comport with constitutional requirements when it does not advise the customer of the availability of a procedure for protesting a proposed termination of utility service as unjustified. The court went on to say:
This Court consistently has held that "some kind of hearing is required at some time before a person is finally deprived of his property interests." Wolff v. McDonnell, 418 U.S. 539, 557 -558 (1974). We agree with the Court of Appeals that due process requires the provision of an opportunity for the presentation to a designated employee of a customer's complaint that he is being overcharged or charged for services not rendered.17 Whether or not such a procedure may be available to other MLG&W customers, both courts below found that it was not made available to Mrs. Craft.18 Petitioners have not made the requisite showing for overturning these "concurrent findings of fact by two courts below . . . ." Graver Tank & Mfg. Co. v. Linde Air Products Co., 336 U.S. 271, 275 (1949).19

[436 U.S. 1, 17]

Our decision in Mathews v. Eldridge, 424 U.S. 319 (1976), provides a framework of analysis for determining the "specific dictates of due process" in this case.

"[O]ur prior decisions indicate that identification of the specific dictates of due process generally requires consideration of three distinct factors: First, the private interest that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the Government's interest, including the function involved and the fiscal and administrative burdens that the additional [436 U.S. 1, 18] or substitute procedural requirement would entail." Id., at 334-335.

Under the balancing approach outlined in Mathews, some administrative procedure for entertaining customer complaints prior to termination is required to afford reasonable assurance against erroneous or arbitrary withholding of essential services. The customer's interest is self-evident. Utility service is a necessity of modern
life; indeed, the discontinuance of water or heating for even short periods of time may threaten health and safety. And the risk of an erroneous deprivation, given the necessary reliance on computers,20 is not insubstantial.21

The utility's interests are not incompatible with affording the notice and procedure described above. Quite apart from its duty as a public service company, a utility - in its own business interests - may be expected to make all reasonable efforts to minimize billing errors and the resulting customer dissatisfaction and possible injury. Cf. Goss v. Lopez, 419 U.S. 565, 583 (1975). Nor should "some kind of hearing" prove burdensome. The opportunity for a meeting with a responsible employee empowered to resolve the dispute could be afforded well in advance of the scheduled date of termination.22 And petitioners would retain the option to terminate [436 U.S. 1, 19] service after affording this opportunity and concluding that the amount billed was justly due.

C

Petitioners contend that the available common-law remedies of a pretermination injunction, a post-termination suit for damages, and post-payment action for a refund are sufficient to cure any perceived inadequacy in MLG&W's procedures.23

Ordinarily, due process of law requires an opportunity for "some kind of hearing" prior to the deprivation of a significant property interest. See Boddie v. Connecticut, 401 U.S. 371, 379 (1971). On occasion, this Court has recognized that where the potential length or severity of the deprivation does not indicate a likelihood of serious loss and where the procedures underlying the decision to act are sufficiently reliable to minimize the risk of erroneous determination, government may act without providing additional "advance procedural safeguards," Ingraham v. Wright, 430 U.S. 651, 680 (1977); see Mathews v. Eldridge, supra, at 339-349.24
[436 U.S. 1, 20]

The factors that have justified exceptions to the requirement of some prior process are not present here. Although utility service may be restored ultimately, the cessation of essential services for any appreciable time works a uniquely final deprivation. Cf. Stanley v. Illinois, 405 U.S. 645, 647 -648 (1972). Moreover, the probability of error in utility cutoff decisions is not so insubstantial as to warrant dispensing with all process prior to termination.25

The injunction remedy referred to by petitioners would not be an adequate substitute for a pretermination review of the disputed bill with a designated employee. Many of the Court's decisions in this area have required additional procedures to further due process, notwithstanding the apparent availability of injunctive relief or recovery provisions. It was thought that such remedies were likely to be too bounded by procedural constraints and too susceptible of delay to provide an effective safeguard against an erroneous deprivation.26 These considerations are applicable in the utility termination context. [436 U.S. 1, 21]

Equitable remedies are particularly unsuited to the resolution of factual disputes typically involving sums of money too small to justify engaging counsel or bringing a lawsuit.27 An action in equity to halt an improper termination, because it is less likely to be pursued28 and less likely to be effective, even if pursued, will not provide the same assurance of accurate decisionmaking as would an adequate administrative procedure. In these circumstances, an informal administrative [436 U.S. 1, 22] remedy, along the lines suggested above, constitutes the process that is "due."

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