Background

The complainants own APN 008-161-026 in Sierra County, a 0.64 acre parcel adjacent to the North Yuba River. Their parcel is a "flag" lot that is accessed by a driveway crossing other parcels from a road known as Forty Niner Drive. The complainants' parcel is part of what was once a 91.3 acre parcel that was subdivided after 1956. The Company serves the entire area that comprised the original parcel, and new service connections are established by the Company as they are requested by individual lot owners.

Complainants intended to construct a house on their lot, and on November 15, 2006, they paid the Company a $2,500 connection fee, pursuant to Rule 16(B.), Cal. P.U.C. Sheet No 167W (effective May 24, 1991), to provide water service to their lot. The Company furnished a Will Serve Letter to Sierra County Building Department on November 16, 2006, as notification of the Company's intent to provide water service to the complainants' parcel.

During the course of construction of the complainants' house, one of complainants' contractors unearthed a shallowly buried 2-inch water pipe under the driveway accessing the complainants' lot from Forty Niner Drive. A dispute arose between the complainants and the Company, eventually involving the owners of a neighboring lot as well, about the respective rights and responsibilities relating to the disturbance of the pipe (which did not serve the complainants' lot) and the removal of some concrete blocks used for protection of the complainants' meter box. Litigation ensued, and the matter is now in State court.

By letter dated January 18, 2008, the Company notified the defendants that it intended to remove their water service if three conditions were not met by February 19, 2008. These conditions included the correction of a map filed with the Building Department that showed an improper connection to a new building to be constructed on a neighboring parcel; restoration of the two-inch service line, which the complainants had capped at the edge of the driveway and removed in the belief that the line was abandoned; and restoration of the concrete blocks around the complainants' meter.

The complainants rectified the first problem, but they claim that they were unwilling or unable to comply with the remaining two conditions, owing to the pendency of the litigation regarding the two-inch pipe and related matters. On February 27, 2008, the Company notified the Sierra County Building Department that its November 16, 2006 Will Serve Letter was withdrawn as of that date, and that water service would be removed from the property. This letter also advised that the complainants could pursue other sources for water service, and stated that the Company understood the complainants had water rights to the North Yuba River.

In response to the February 27 letter, the complainants arranged for the construction of a well and pump to replace the Company's water service. They paid $1,000 to Sierra County for a variance, $12,035 for the well drilling and related work, and $5,841.43 for a pump, or a total of $18,876.43 to replace their lost water service. There is no evidence disputing the reasonableness of these expenses.