After my town installed new meter, readings went from38,000- 43,000 down to 8,000. Town said I must have had a running toilet (for five years? ) Not so.
Question: Is it possible for a water meter to malfunction resulting an erroneous reading?

I would greatly appreciate an answer, as I have been fighting the town for 5 years. When I suggested that the old meter malfunctioned, they said they would attempt to locate it, guess what, they were not successful. Another question,
If it was not possible for a meter to malfunction, why would the town even bother to try to locate it?

Thank you in advance for your assistance.

You were paying for 40,000 gallons of water each month? I would have protested right away! Depending on the size of the household, you may have used 10_12,000 gallons per month. My wife and I shower every day, use the DW, washer every couple of days and never go over 6,000.