Opinion ID: 2622975
Heading Depth: 2
Heading Rank: 2

Heading: petitioners' appellate standing

Text: ¶ 44 Generally, a party lacks appellate standing when the party is denied intervention in a proceeding and therefore is unable to participate below. This is a corollary to the exhaustion of remedies requirement that must be satisfied in order to appeal a Commission decision. [48] In this case, however, our appellate standing analysis does not end with affirming the Commission's decision to deny Ball and Geddes intervention in the proceedings. Utah Code section 54-7-15 grants standing to certain classes of individuals to seek judicial review of Commission decisions regarding public utilities. Nevertheless, such individuals are not given standing to appeal any Commission decision, but must also be aggrieved or substantially prejudiced by that decision. [49] Thus, we must now determine whether any individual petitioner in this case has appellate standing to seek judicial review of the Commission's orders.
¶ 45 As we have stated, Prior to deciding the substantive questions presented by the parties, this Court must ascertain whether it has subject matter jurisdiction over the petitions and the appeal before it. [50] In this case, three sections of the Utah Code are relevant in determining whether any individuals have appellate standing that would grant this court subject matter jurisdiction to hear their appeal: (1) section 54-7-15, (2) section 63-46b-14, and (3) section 63-46b-16. Read together, these three sections provide the basis for our standing analysis. ¶ 46 First, section 54-7-15 of the Public Utilities Act (PUA) identifies the individuals who are allowed to seek judicial review of a Commission decision. Section 54-7-15(1) states as follows: Before seeking judicial review of the commission's action, any party, stockholder, bondholder, or other person pecuniarily interested in the public utility who is dissatisfied with an order of the commission shall meet the requirements of this section. [51] ¶ 47 Second, section 63-46b-14 of the UAPA, which governs state administrative agency proceedings, requires individuals to exhaust all administrative remedies before they will be allowed to seek judicial review of an agency decision. [52] This includes applying for a rehearing with the Commission. [53] The UAPA also reflects the traditional notion that a party may appeal only an adverse judgment. [54] ¶ 48 Third, section 63-46b-16(4) echoes the aggrievement requirement of section 63-46b-14 by using a synonymous term, stating as follows: The appellate court shall grant relief only if, on the basis of the agency's record, it determines that a person seeking judicial review has been substantially prejudiced . . . . [55] Thus, if an agency decision has not substantially prejudiced the appealing party, the party has no appellate standing. ¶ 49 In sum, an individual may have appellate standing to seek judicial review of an agency decision if he or she has exhausted all administrative remedies and qualifies as an aggrieved or substantially prejudiced party, stockholder, bondholder, or other person pecuniarily interested in the public utility. ¶ 50 The exhaustion of administrative remedies is not at issue here, since the Petitioners sought rehearing before the Commission on both the Intervention Order and the Approval Order. Further, while none of the Petitioners were parties to the proceedings below, [56] (indeed only Ball and Geddes petitioned the Commission to intervene and their request was denied) some of the Petitioners are ratepayers or stockholders of Questar. We therefore are left to consider whether those petitioners who qualify as nonparty (1) ratepayers or (2) stockholders have appellate standing. We conclude that the ratepayers do not have standing because they are not pecuniarily interested in the public utility. And while the stockholders are among an authorized class of persons who have standing, they are not aggrieved or substantially prejudiced by the Commission's decision and therefore have no appellate standing.
¶ 51 We first note that ratepayers who were parties to the proceedings below may have appellate standing in a given case if they exhaust all administrative remedies and are aggrieved by the Commission's decision. But in this case, where none of the Petitioners were parties to the action below, the Petitioners argue that ratepayers have appellate standing because they qualify as pecuniarily interested in the public utility and are aggrieved by the Commission's decision to approve Questar's cost recovery. There is no dispute among the parties that the ratepayers are adversely affected in the short term by the Commission's decision. In fact, Questar concedes that their cost recovery will result in an approximate $0.50 increase per month in a ratepayer's gas bill until the stipulated transition period is completed as planned in 2008. Differences arise, however, in the parties' interpretation of the term pecuniarily interested in the public utility. ¶ 52 According to the Petitioners, a pecuniary interest in the public utility means having some kind of financial interest related to the public utility. So the Petitioners argue that because ratepayers are financially affected by Questar's cost recovery, ratepayers qualify as pecuniarily interested in the public utility and therefore have standing to appeal the Commission's decision. ¶ 53 On the other hand, the Respondents argue that having a pecuniary interest in the public utility means having a direct financial stake in the public utility, such as that of a stockholder, rather than having a financial relation to the public utility, such as that of a ratepayer. We agree. ¶ 54 First, under the doctrine of ejusdem generis, ratepayers simply do not qualify as persons pecuniarily interested in the public utility by the very terms of the statute. [57] The term pecuniarily interested in the public utility must be interpreted as a class consistent with the terms stockholder and bondholder. [Ejusdem generis] declares that in order to give meaning to the general term, the general term is understood as restricted to include things of the same kind, class, character, or nature as those specifically enumerated, unless there is something to show a contrary intent. [58] The statute first speaks in terms of stockholders and bondholders, individuals that have a specific financial stake in the public utility, whether it be equity or debt. A ratepayer, although financially affected in the sense of paying higher or lower rates as a consumer, does not have a stake in the public utility akin to a stockholder or bondholder and therefore does not qualify as a person pecuniarily interested in the public utility. Furthermore, a ratepayer's financial interest is in direct opposition to that of stockholders and bondholders and therefore inconsistent with a pecuniary interest in the public utility. Indeed, ratepayers want low rates, while stockholders generally want greater revenues, and as a result, higher rates. It would be nonsensical to interpret ratepayers as falling within the same class of persons as stockholders when the interests of the two classes are opposed to each other. [59] ¶ 55 Second, we note the complete absence of the term ratepayer or customer in this section of the statute. The Legislature was well aware of these terms as evidenced by their frequent use in the PUA, yet the terms are notably absent from section 54-7-15. [60] ¶ 56 Third, sections 54-1-11 and 54-4a-5 of the PUA support our interpretation of the term pecuniarily interested in the public utility. Section 54-1-11(1)(a) states that [n]o person employed as a commissioner or as personnel of the commission shall, while so employed . . . [h]ave any pecuniary interest, whether as the holder of stock or other securities . . . [of] any public utility. Similarly, section 54-4a-5(1) states that [n]o employee of the Division of Public Utilities shall, while so employed . . . have any pecuniary interest, whether as the holder of stock or other securities . . . [of] any public utility. [61] Thus, consistent with these sections, a commissioner or employee with a pecuniary interest is one who holds stock or other securities of a public utility, not a mere ratepayer, a category that would presumably include all commissioners. ¶ 57 Ultimately, although the ratepayers are aggrieved by the increase to their gas bill resulting from the Commission's decision, they lack appellate standing because they have no pecuniary interest in the public utility and therefore do not fall within the classes of persons to whom standing is granted. We now turn to the remaining three petitioners who have provided stock certificates to verify their status as Questar stockholders.
¶ 58 Of the many petitioners in this case, only three are Questar stockholders. As stockholders, these individuals are explicitly granted the right to seek judicial review under the PUA. [62] Unlike the ratepayers, however, the stockholders lack appellate standing in this case because they are not aggrieved or substantially prejudiced by the Commission's decision. ¶ 59 In Utah Chapter of the Sierra Club v. Utah Air Quality Board, we held that standing requires a showing of injury, causation, and redressability. [63] And we have stated that the term aggrieved connotes nothing more than a showing of injury, the traditional principle that claimants `must be able to show that [they have] suffered some distinct and palpable injury that gives [them] a personal stake in the outcome of the legal dispute.' [64] In this case, the stockholders fail to assert a proper injury to meet the first element of the traditional test; therefore, a full analysis of standing is unnecessary. ¶ 60 The Petitioners' brief does not provide much by way of argument as to how the Questar stockholders have been injured in that capacity by the Commission's decision. Although the Petitioners' brief inadequately addresses the stockholders' injury, the stockholders set forth in personal affidavits a claim that they may be adversely affected in the long term by Questar's self-dealing transaction with Questar Pipeline, which enabled the CO2 plant to be built. The stockholders allege that approving the Stipulation will encourage Questar to continue affiliate transactions and will lead stockholders to suffer a fate comparable to the stockholders of Enron, WorldCom, or Tyco. But the stockholders fail to assert any injury similar to the economic injury alleged by the ratepayers. In fact, the Petitioners' brief indicates that Questar stockholders have benefitted from the improved financial situation that resulted from the Commission's approval of the cost recovery. Furthermore, the stockholders do not assert that their alleged injury is imminent. Rather, their alleged injury is one that might take place sometime in the future. In short, stockholders may have appellate standing where the Commission's decision substantially prejudices the interests of those stockholders, but such is not the case here. ¶ 61 Protecting stockholders from corporate mismanagement does not fall within the zone of interest contemplated by section 54-7-15. A person who is aggrieved by agency action must establish that the injury he complains of . . . falls within the `zone of interests' sought to be protected by the statutory provision whose violation forms the legal basis for his complaint. [65] The Public Utilities Act was created to regulate utilities, not to protect stockholders from mismanagement. Stockholders are given other means to deal with such matters. Indeed, the Petitioners recognized before the Commission the stockholders' ultimate remedy when dealing with corporate mismanagement. The Petitioners' stated that, unlike ratepayers, [i]f the Questar shareholders believe that their company's executives have injured their interests by wrongheaded business decisions, they have a choice  they can seek redress through the corporate oversight shareholders have always had with respect to management functions or they can sell their shares and invest in better operated companies. ¶ 62 In sum, the ratepayers may have suffered a distinct and palpable injury but are not among the classes of persons authorized by statute to appeal an agency decision. On the other hand, the stockholders are an authorized class but lack a distinct and palpable injury to qualify as a party aggrieved or substantially prejudiced. Therefore, none of the Petitioners qualify for appellate standing before this Court.