Opinion ID: 1230017
Heading Depth: 1
Heading Rank: 2

Heading: the commission lacks the authority to grant exclusive rights to telecommunications companies

Text: [1, 2] This court examines issues of law de novo. Overton v. Economic Assistance Auth., 96 Wn.2d 552, 637 P.2d 652 (1981). As with all issues of statutory interpretation, the primary objective is to find the intent of the Legislature. That intent must be determined primarily from the statutory language. State Department of Transp. v. State Employees' Ins. Bd., 97 Wn.2d 454, 458-59, 645 P.2d 1076 (1982). [3-5] An agency possesses only those powers granted by statute. Cole v. Washington Utils. & Transp. Comm'n, 79 Wn.2d 302, 306, 485 P.2d 71 (1971). RCW 80.36.230 reads: The commission is hereby granted the power to prescribe exchange area boundaries and/or territorial boundaries for telecommunications companies. This language does not confer on the Commission the power to grant monopolies or exclusive rights. Since the Commission is fully capable of exercising its authority under RCW 80.36.230 without the power to grant monopolies or other exclusive rights, the text does not necessarily or impliedly grant such power. See In re Little, 95 Wn.2d 545, 627 P.2d 543 (1981) (permitting an agency to exercise power where power is necessary to implement statutory scheme), overruled on other grounds in State v. Danforth, 97 Wn.2d 255, 643 P.2d 882 (1982); Hillis Homes, Inc. v. Snohomish Cy., 97 Wn.2d 804, 808, 650 P.2d 193 (1982) (without express authority, action by county which is considered suspect under the Washington State Constitution is invalid, no matter how necessary it might be). The Commission therefore lacks the authority under RCW 80.36.230 to grant exclusive rights to LEC's. Appellants suggest this holding renders the words companies and and/or territorial boundaries in RCW 80.36.230 superfluous. See Brief of Appellant (WUTC), at 25; Brief of Cross-Appellant (Whidbey), at 17-19. This is not correct. Our interpretation of RCW 80.36.230 enables the Commission to define the geographical limits of a company's obligation to provide service on demand and to delineate the boundaries between local and long distance calling. Even were the statute ambiguous, our state constitution makes it inappropriate to impute to RCW 80.36.230 a conferral of authority on the Commission to grant monopolies. Const. art. 12, § 19 states in relevant portion: Any association or corporation, or the lessees or managers thereof, organized for the purpose, or any individual, shall have the right to construct and maintain lines of telegraph and telephone within this state, and said companies shall receive and transmit each other's messages without delay or discrimination and all of such companies are hereby declared to be common carriers and subject to legislative control.... The legislature shall ... provide reasonable regulations to give effect to this section. Appellants claim the phrases subject to legislative control and reasonable regulations permit the Commission to grant monopolies. This contention is unpersuasive. The structure of the passage indicates all corporations have the right to construct lines and such corporations are subject to legislative control. The mandate that the Legislature provide reasonable regulations to protect the right of all corporations to provide telecommunications services in no way eviscerates the constitutional protection. A second passage of the constitution likewise militates against imputing the authority to grant monopolies. Const. art. 12, § 22 states: Monopolies and trusts shall never be allowed in this state, and no incorporated company, copartnership, or association of persons in this state shall directly or indirectly combine or make any contract with any other incorporated company, foreign or domestic, through their stockholders, or the trustees or assignees of such stockholders, or with any copartnership or association of persons, or in any manner whatever for the purpose of fixing the price or limiting the production or regulating the transportation of-any product or commodity. Neither Const. art. 12, § 19 nor Const. art. 12, § 22 represents an absolute prohibition against monopolies. See State ex rel. Department of Pub. Works v. Inland Forwarding Corp., 164 Wash. 412, 2 P.2d 888 (1931); Kitsap Cy. Transp. Co. v. Manitou Beach-Agate Pass Ferry Ass'n, 176 Wash. 486, 496, 30 P.2d 233 (1934) (permitting State to prohibit entry of competitor when entrance would be inimical to the best interests of the ... public at large); Chas. Uhden, Inc. v. Greenough, 181 Wash. 412, 43 P.2d 983, 98 A.L.R. 1181 (1935). They do however manifest the state's abhorrence of monopolies. Given the constitutional protection of the right of all companies to provide telecommunications services and the constitutional proclamation against monopolies, the Legislature must expressly grant to the Commission the authority to grant monopolies before the Commission may exercise such rights. Appellants' position is in addition inconsistent with the objective of the telecommunications act. RCW 80.36.300(5) notes it is the state's policy to [p]romote diversity in the supply of telecommunications services and products in telecommunications markets throughout the state. Recognizing an implicit authority to grant monopolies would frustrate this express legislative goal of assuring diversity. Appellants rely on nontextual support in the form of legislative history, the Commission's historic stance, legislative inaction, judicial interpretations, and an Attorney General opinion to support their contention that RCW 80.36.230 authorizes the Commission to grant monopolies. They argue that a case decided by the Commission shortly prior to the enactment of RCW 80.36.230 illustrated the Commission's frustration over limitations in its power and proves that the Commission's desire to prescribe exclusive areas prompted the enactment of RCW 80.36.230. The case cited by appellants for this position is noteworthy, not for its lament over the Commission's inability to grant exclusive franchises, however, but for its recognition of the Commission's inability to limit an LEC's obligations to a discrete territorial area. See Department of Pub. Serv. v. Lower Naches Tel. Co., Dep't of Pub. Serv. cause 7357 (1940). In a convincing dissent to the Commission's recognition of exclusive rights, Commission Chair Sharon Nelson wrote: It appears the real purpose of [RCW 80.36.230] was to bring some order out of the chaos associated with small independent telephone companies, to clearly delineate local and interexchange telephone calling, and to create zones for local telephone service.... To claim now that the statute gives incumbent providers a perpetual monopoly over all intraexchange telecommunications services currently offered by them or yet to be invented strains credulity. Administrative Record (ELI), Order, at 61 (Chairman Nelson, dissenting), [6, 7] Appellants recite a litany of Commission decisions which reflect the Commission's treatment of exchange areas as exclusive. [5] However, appellants confuse the LEC's' historic enjoyment of a de facto, partial monopoly with a statutorily-authorized, de jure monopoly. In addition, although we generally accord substantial deference to agency decisions, Impecoven v. Department of Rev., 120 Wn.2d 357, 363, 841 P.2d 752 (1992), we do not defer to an agency the power to determine the scope of its own authority. Appellants further argue that despite the Commission's long-time treatment of its approval of exchanges as effective monopolies, the Legislature has never amended RCW 80.36.230. Appellants consider this legislative inaction to be evidence of legislative acquiescence. Legislative silence by itself is not dispositive. See Bowles v. Department of Retirement Sys., 121 Wn.2d 52, 63, 847 P.2d 440 (1993) (an agency's actions are entitled to greater weight in the context of legislative silence). Furthermore, we note that the Legislature has not been silent. The Joint Select Committee on Telecommunications has expressly declared its uncertainty over whether the Commission possesses the authority to grant monopolies. See Joint Select Committee on Telecommunications, Washington State Legislature (Final Report), at 12 (1985) (Washington law is not settled on whether a grant of an exchange area by the Commission constitutes an exclusive franchise). Appellants also contend that courts in Washington have recognized the exclusivity of LEC rights. They cite Prescott Tel. & Tel. Co. v. Utilities & Transp. Comm'n, 30 Wn. App. 413, 418, 634 P.2d 897 (1981) and Jewell v. Washington Utils. & Transp. Comm'n, 90 Wn.2d 775, 777-78, 585 P.2d 1167 (1978). However, neither Prescott nor Jewell is controlling because neither squarely addressed whether the Commission possesses the authority to grant exclusive rights. Prescott involved two narrow issues: whether an LEC's exchange boundary was validly created; and whether the Commission acted arbitrarily and capriciously in holding that an exchange territory could not be taken away from the LEC absent a showing the LEC was unwilling or unable to provide service in the territory. It did not hold that the Commission possesses the power to grant monopoly rights to LEC's. [8] Likewise, Jewell addressed the narrow issue of whether charitable contributions by privately owned telephone companies should be paid by telephone users or company stockholders. The Jewell court assumed the companies enjoyed monopoly rights. The holding that stockholders should pay for the contributions would have applied equally however even if de jure monopoly rights were not granted. As noted, a de facto monopoly does not constitute a de jure monopoly. We do not rely on cases that fail to specifically raise or decide an issue. In re Estate of Elliott, 22 Wn.2d 334, 348, 156 P.2d 427, 157 A.L.R. 1335 (1945); State ex rel. Todd v. Yelle, 7 Wn.2d 443, 110 P.2d 162 (1941) (doctrine of stare decisis does not apply to language which is unnecessary to conclusion reached). Thus, neither Prescott nor Jewell is controlling authority for the issue presently before the court. [9, 10] Finally, in a 37-year-old opinion, the Attorney General opined the Commission possesses the authority to prescribe exclusive areas under RCW 80.36.230. See AGO 223 (1956). Although Attorney General opinions are generally entitled to considerable weight, Bowles v. Department of Retirement Sys., supra , Attorney General opinions are not controlling on this court. Washington Fed'n of State Employees, Coun. 28 v. Office of Fin. Mgt., 121 Wn.2d 152, 849 P.2d 1201 (1993). Moreover, they are entitled to less deference when statutory interpretation is at issue. Washington Fed'n of State Employees, at 164. Given the absence of express authority in RCW 80.36.230, the constitutional protection of broad participation by telecommunications companies, the constitutional aversion to monopolies, and the Legislature's own uncertainty regarding the meaning of RCW 80.36.230, we disagree with the conclusion of the Attorney General. We affirm the trial court's decision that the Commission is powerless to grant monopolies. Our holding does not prevent the Commission from limiting the number of LEC's or other telecommunications companies which may operate in a given territory. It does however forbid the Commission from legally conferring on any LEC the right to be the exclusive provider of telecommunications services in a given exchange.