Smiths Water Auth. v. City of Phenix City

This is an appeal from a declaratory judgment in a proceeding to determine the validity of a rate increase under the terms of a contract. We affirm in part, reverse in part, and remand.

FACTS

Plaintiff, the city of Phenix City, Alabama (City), a municipal corporation located in Russell County, operates a water distribution system. Defendant, Smiths Water Authority (Smiths), is a public corporation which operates a water distribution system serving customers in Lee and Russell counties. On April 18, 1979, the parties entered into a 27-year "Contract for Sale of Water" (contract) by which the…