Opinion ID: 2332011
Heading Depth: 2
Heading Rank: 1

Heading: Average Test Year Expenses Analysis

Text: Casco contends that the Commission's use of an average test year analysis to determine the Company's expenses for ratemaking purposes constituted an error of law, denied it procedural due process, and confiscated its property. In effect, the Commission determined Casco's expenses for certain items, such as advertising and repairs, by calculating a four-year average of the annual expenses for those items from 1971 to 1974. In so doing, the Commission appears to have substantially adopted the expense figures presented by Casco in its Request for Findings of Fact by the Commission. Casco now argues before this Court that the averaging analysis denied it due process of law and confiscated its property because  in this inflationary society the average of the last three or four years' expenses does not reflect even current expenses let alone expenses which will be incurred in the period of time in which the rates are generally expected to be in effect.  Thus, Casco urges this Court to rule, as a matter of law, that in an inflationary period it would be an error of law to project operating expenses into the future by averaging the costs of operating over the last four-year period. We find it is unnecessary to reach this question. As the Commission correctly stresses in its brief, the expense figures derived from the four-year averaging analysis, are substantially those proposed by Casco in the proceedings before the Commission below. Apparently, Casco followed, without question, [2] the averaging analysis used by the Commission in past Casco rate proceedings to calculate its proposed expenses for the 1975 rate case. These averaged expenses were incorporated in Casco's Request for Findings of Fact. The Commission substantially adopted all the expense figures proposed by Casco. The only differences in its final decree appear to be an increase in Casco's travel and convention expense (in Casco's favor) and the disallowance of auto and bus commuting expense (considered below, II-F). The Commission is now faced for the first time with any serious objection by Casco to its averaging method. In Walsh v. City of Brewer, Me., 315 A.2d 200 (1974), we stated the principle that disposes of the immediate issue: It is an acknowledged principle, and one generally followed by this Court as necessary to a sound appellate practice, that an issue raised for the first time at the appellate stage will be denied cognizance in the appellate review of the case. Reville v. Reville, Me., 289 A.2d 695 (1972) ; Younie v. State, Me., 281 A.2d 446 (1971) ; Frost v. Lucey, Me., 231 A.2d 441 (1967) . Id. at 209. The fact that the proceeding below occurred before the Public Utilities Commission, and not before a trial court, does not affect the application of this principle. A reviewing court usurps the agency's function when it sets aside the administrative determination upon a ground not theretofore presented and deprives the Commission of an opportunity to consider the matter, make its ruling, and state the reasons for its action. Unemployment Compensation Commission of Alaska v. Aragon, 329 U.S. 143, 155, 67 S.Ct. 245, 251, 91 L.Ed. 136 (1946). See also 3 K. Davis, Administrative Law Treatise § 20.06 (1958). Similarly, the Commission must be afforded the opportunity to consider a utility's objections to its methodology, and to exercise its expertise and judgment in response to articulated objections and recommendations by the utility. We will not overrule the Commission on an issue which was not adequately presented for its consideration during the proceedings below. This is not only a case in which the complainant failed to raise the issue below. The complainant suggested the approach ultimately followed by the Commission. The complainant cannot now claim error. [A] party cannot except to any proceedings of a court, which take place in accordance with his own request, or by his consent. Mudget v. Kent, 18 Me. 349, 350 (1841). See also Warren v. Waterville Urban Renewal Authority, Me., 235 A.2d 295, 299 (1967), cert. denied, 390 U.S. 1006, 88 S.Ct. 1249, 20 L.Ed.2d 105 (1968); Portland Flying Service, Inc. v. Smith, Me., 227 A.2d 446, 447-48 (1967). We find no error in the Commission's average test year expenses analysis.