Massachusetts Municipal Wholesale Electric Co. v. Town of Danvers
Massachusetts Municipal Wholesale Electric Co. v. Town of Danvers
Opinion of the Court
Hudson Light and Power Department and Peabody Municipal Light Plant
In their counterclaim and affidavits, the municipalities offered no proof of a promise or representation by MMWEC that MMWEC would assume the risk in the event that enforcement of the sellback rights became impossible.
So ordered.
Hudson Light and Power Department and Peabody Municipal Light Plant, along with MMWEC, are the only remaining parties in this case.
Under such an agreement, PSNH would agree to repurchase from the municipalities a specified amount of the power at the municipalities’ cost.
The agreements under which the power sales took place are structured to protect bondholders who financed the power plant by placing risks on the purchasers, who are called participants. See Massachusetts Mun. Wholesale Elec. Co. v. Danvers, 411 Mass. 39, 42-43, 49-51 (1991); Public Serv. Co. of N.H., supra at 345. “It is not likely that the parties intended to isolate one specific risk . . . and place it on MMWEC, while allocating the rest of the risks to the participants. In the absence of any clear provision to the contrary, it is reasonable to assume that the parties intended to allocate [all] risk[s] to the participants.” Danvers, supra at 51.
Reference
- Full Case Name
- Massachusetts Municipal Wholesale Electric Company v. Town of Danvers
- Status
- Published