Background

The parties furnished the following basic background facts for purposes of defining the issues.

Until June 1999, a company called Cybernet Communications (Cybernet) provided telecommunications services to XYZ. Cybernet installed a device called an auto-dialer on XYZ's premises, the purpose of which was to route calls away from XYZ's presubscription carrier. XYZ subsequently entered into a contract with PCS to receive IntraLATA and InterLATA toll services at rates specified in the contract. The applicable tariff is Cal. Sched. P.U.C. 1-T. When the service was changed over to PCS, Cybernet disconnected the lines to the auto-dialer, but left the device on XYZ's premises. PCS stated that it would require a telecommunications technician to reconnect the lines to the auto-dialer.

For a 9-month period, between October 1999 and September 2000, PCS, as billing agent, billed XYZ for InterLATA calls that were routed over the AT&T network and billed at casual rates, which were significantly higher than PCS' contract rates. PCS paid AT&T for these calls, and XYZ paid PCS for the corresponding charges for a number of months until XYZ noticed the discrepancy and claimed that it was entitled to a partial refund because the charges exceeded the contract rates.

PCS contends that either the auto-dialer was reconnected, or that XYZ's employees were using "dial-around" access codes (e.g., 10-10 numbers), either of which would result in the higher charges. XYZ rejects both of these theories. XYZ contends that it was informed PCS experienced network problems during the period in question, and that this fact accounts for the overcharges. PCS denies this explanation.

The total sum in dispute is approximately $1,600, reduced by the amount XYZ would have paid at the rates specified by the contract.