Source: http://www.chanrobles.com/usa/us_supremecourt/376/515/case.php
Timestamp: 2018-06-21 06:37:24
Document Index: 258797931

Matched Legal Cases: ['§ 7', '§ 7', '§ 157', '§ 157', '§ 4', '§ 4']

The issue in this case is whether the Federal Power Commission, when granting an application for a temporary certificate authorizing the sale of natural gas in interstate commerce, can impose a condition that the applicant shall not increase its certificated price pending a hearing on the applicant's petition for permanent authority. Each of the seven applications involved here requested temporary operating authority to sell natural gas in interstate commerce on emergency grounds, as provided by § 7(c) and (e) of the Natural chanroblesvirtualawlibrary
Gas Act. [Footnote 1] In each case, the Federal Power Commission conditioned the temporary grant of authority upon, inter alia, the producer's maintaining the initial price, without chanroblesvirtualawlibrary
The Hunts are producers of natural gas in the Alta Loma area in Galveston County in Texas Railroad District No. 3. In July, 1960, the Commission issued a permanent certificate authorizing sales of natural gas from the Alta Loma and other areas to the Peoples Gulf Coast Natural Gas Pipeline Co., 24 F.P.C. 1. The authorization was conditioned upon the producer's filing chanroblesvirtualawlibrary
Thereafter, on February 27, 1961, the Hassie Hunt Trust applied for a permanent certificate of public convenience and necessity allowing sales from a new well in this same area to Natural Gas Pipeline Company of America, the successor to Peoples Gulf Coast. It also applied for temporary authorization to begin service immediately under the emergency provisions of the Commission's Regulations issued under § 7(c) of the Act. 18 CFR § 157.28. The emergency was alleged to result from the "necessity of paying shut-in royalties and the incurrence of drainage through sales by others to pipeline companies other than Natural." The new sale was covered by a 20-year contract, dated December 15, 1960, with provisions identical to those of the earlier contract, i.e., an initial price of 20� per Mcf. with 2� escalations at four-year intervals. The Commission, on April 7, 1961, granted the temporary authorization subject to chanroblesvirtualawlibrary
Section 7(c) came into the Natural Gas Act in 1942, and provides the method by which gas may be dedicated chanroblesvirtualawlibrary
Pursuant to this authorization, the Commission adopted a regulation which sets out standards for emergency authorizations and requires the applicant to file "a statement of intention to invoke this section." 18 CFR § 157.28(c). The Commission grants the temporary certificate, where it deems necessary, without notice or hearing. Under the terms of the regulation, this authorization continues until final Commission action under §§ 4 and 7, "without prejudice chanroblesvirtualawlibrary
In the instant case no permanent certificates authorizing sales in interstate commerce have yet been issued. Temporary certificates have been allowed, and each is conditioned upon the maintenance of the initial price. Thus, if respondents' position is correct, then the conditions precedent to the issuance of the temporary certificates required by the Commission can be nullified by subsequent independent action of the respondents in filing a new contract under § 4. We do not believe that the Congress intended any such incongruous result. chanroblesvirtualawlibrary
This Court previously discussed the use of the temporary certificate procedure in Atlantic Refining Co. v. Public Service Comm'n, supra. There, we indicated that the Commission might avail itself of its power to condition the initial certification of natural gas into interstate commerce in order to prevent a triggering of general price rises. The language is unmistakably clear as to the chanroblesvirtualawlibrary
The existence of broad discretionary power in the Commission to condition temporary certificates appears to us to be vital to its ability to hold the line in pricing. The extent of that power in permanent certification is not before us now, since each of these applications is for temporary certification. It is said that the condition of the Commission's docket transposes, for all practical matters, chanroblesvirtualawlibrary