The correct answer to this open question is the following.
Although the question does not include options, we can say the following.
What Kant would say about this case is this. For Emmanual Kant, the most important and high concept was Good Will. This means that the individual has the moral obligation to act to its highest standards every single time. The moral of the acts of a human being is the expression of his will, manifested in always doing the right thing. So in this case, although the water company does not send bills to James' house, James has the moral obligation of reporting that he is using the water to mow its lawn.