Opinion ID: 2040616
Heading Depth: 1
Heading Rank: 2

Heading: Effect of DPC's Failure to Include All Statutory Allegations in the Petition Filed with the Commission.

Text: The first issue on appeal centers around petitioner's claim that the proceedings before the commission were invalid as a result of the DPC's failure to set forth in its petition all of the allegations required by Iowa Code section 478.3 (1981). He filed a motion to dismiss DPC's petition and amended petition on this ground. Section 478.3 provides: 1. All petitions shall set forth: a. The name of the individual, company, or corporation asking for the franchise. b. The principal office or place of business. c. The starting points, routes, and termini of the proposed lines, accompanied with a map or plat showing such details. d. A general description of the public or private lands, highways, and streams over, across, or along which any proposed line will pass. e. General specifications as to materials and manner of construction. f. The maximum voltage to be carried over each line. g. Whether or not the exercise of the right of eminent domain will be used and, if so, a specific reference to the lands described in paragraph d which are sought to be subject thereto. h. An allegation that the proposed construction is necessary to serve a public use. 2. Petitions for transmission lines carrying thirty-four point five kilovolts or more and extending a distance of not less than one mile across privately owned real estate shall also set forth an allegation that the proposed construction represents a reasonable relationship to an overall plan of transmitting electricity in the public interest and substantiation of such allegations, including but not limited to, a showing of the following: a. The relationship of the proposed project to present and future economic development of the area. b. The relationship of the proposed project to comprehensive electric utility planning. c. The relationship of the proposed project to the needs of the public presently served and future projections based on population trends. d. The relationship of the proposed project to the existing electric utility system and parallel existing utility routes. e. The relationship of the proposed project to any other power system planned for the future. f. The possible use of alternative routes and methods of supply. g. The relationship of the proposed project to the present and future land use and zoning ordinances. h. The inconvenience or undue injury which may result to property owners as a result of the proposed project. The commission may waive the proof required for such allegations which are not applicable to a particular proposed project. The petition shall contain an affidavit stating that informational meetings were held in each county which the proposed project will affect and the time and place of each meeting. DPC's original petition filed with the commission on July 9, 1981, contained the information required by paragraphs a, b, c, d, e, and f of subsection (1) of the foregoing statute. With respect to the information called for in paragraph g of that subsection, the petition recited that, in regard to one of fourteen segments where easements were required to complete the project, the necessary easement had not yet been obtained. The location of all fourteen segments was shown on a map filed with the petition, but the particular segment for which the power of eminent domain would be required was not identified. That segment was the area where the project crossed petitioner's lands. The record does reflect, however, that a letter was sent to petitioner by the commission on August 24, 1981, advising him that DPC was seeking the power of eminent domain for the portion of the project crossing his property. Although there was no allegation of public purpose in the body of the petition conforming with paragraph h of subsection (1), an affidavit of an officer of DPC was attached to the petition averring that the proposed substation project was necessary to provide adequate and reliable electric service to its member co-operatives and their customers. We believe DPC's petition substantially complied with the requirements of subsection (1) of section 478.3. It did not, however, comply with the requirements of subsection (2) of that statute, although those requirements are facially applicable to the proposed project as a result of its length and proposed voltage levels. By a proposed amendment to its petition, approved by the hearing examiner subsequent to the November 10, 1981 hearing and prior to the reopened hearing of May 20, 1982, DPC set forth in conclusory fashion those matters required to be included in the petition by paragraphs a-h, inclusive, of subsection 2. The petitioner contends that this amendment did not cure the deficiencies in the original petition because it was (1) untimely, (2) unverified, and (3) overly conclusory. Those complaints which relate to DPC's failure to verify the amendment to its petition and the conclusory nature of the amended allegations are not persuasive when considered in connection with an administrative proceeding ultimately determined by contested case procedure. The statutory requirements for verification of the petition and substantiation of the allegations of the petition appear to be designed to assist the commission's needs in those cases which, in the absence of formal objection or the necessity of seeking power of eminent domain, see Iowa Code section 478.6 (1981), will be decided without resort to a contested case hearing. With regard to petitioner's claim that the amendment to petition was untimely, it appears that no prejudice resulted to him as a result of DPC's failure to amend its petition at an earlier time. Regardless of the timing of the amendment, DPC was at all times required by law to establish to the satisfaction of the commission that the proposed project was necessary to serve a public use and represented a reasonable relationship to an overall plan of transmitting electricity in the public interest. See Iowa Code § 478.4. Petitioner, within the time for filing objections to the project and nearly two months prior to the initial hearing date, advised the commission in writing of his objections to the project based upon his belief that it would fill no current or accurately projected future need for electric power in the area sought to be served, had not been the subject of adequate planning, was not shown to be cost effective, and was located without adequate regard to alternative routes, alternative methods of transmission or alternative methods of power production. As a practical consequence of petitioner's objections, DPC had been placed upon its proof concerning the elements which section 478.3 requires to be contained in the petition long before the filing of the amendment. We cannot agree with petitioner's contentions that the inclusion of all of the requirements of section 478.3 in the petition is jurisdictional in cases where the issuance of a franchise and grant of necessary powers of eminent domain are determined by contested case procedure. The notice which must be afforded private party objectors in such cases is that prescribed by Iowa Code section 17A.12 (1981). That statute, provides, in part: 1. In a contested case, all parties shall be afforded an opportunity for hearing after reasonable notice in writing delivered either by personal service as in civil actions or by certified mail return receipt requested. However, an agency may provide by rule for the delivery of such notice by other means. Delivery of the notice referred to in this subsection shall constitute commencement of the contested case proceeding. 2. The notice shall include: a. A statement of the time, place and nature of the hearing. b. A statement of the legal authority and jurisdiction under which the hearing is to be held. c. A reference to the particular sections of the statutes and rules involved. d. A short and plain statement of the matters asserted. If the agency or other party is unable to state the matters in detail at the time the notice is served, the initial notice may be limited to a statement of the issues involved. Thereafter upon application a more definite and detailed statement shall be furnished. It is more appropriate that the rights of an affected property owner or other objecting party in proceedings under chapter 478 be considered on the basis of adequate notice of the issues to be considered at the hearing rather than the detailed informational requirements of section 478.3. As previously noted, many of the requirements of that statute appear to be for the benefit of the commission in matters to be decided by other than contested case proceedings. Depending on the particular case involved, the contested case hearing may not involve all of the elements deemed significant under the statute or, may involve matters not included in section 478.3. Petitioner was given notice by certified mail delivered September 8, 1981, of the initial hearing to be held on October 27, 1981. That notice advised him of the time and place of the hearing, that a petition for an electric franchise involving a 72,000 volt line would be determined at the hearing, that a right of eminent domain across his property would be considered, the location of the desired easement across his property, that he had a right to file objections to the project with the commission, [1] that evidence could be presented at the hearing, and that he could cross-examine witnesses presented by others. In addition, the notice advised petitioner of a phone number he could call for additional information. The only reference in the notice to the statutory authority and jurisdiction of the commission was a general reference to Iowa Code chapter 478 (1981). We are cognizant of the fact that that statute requires a reference to the particular section of the Code or administrative rules involved and that this was not contained in the commission's notice to petitioner. Because Fischer would, by his objection, yet determine at least some of the statutes or rules to be considered at the hearing, the initial notice of hearing could not be comprehensive. Cf. § 17A.12(1)(d) (If the agency is unable to state the matters in detail at the time the notice is served, the notice may be limited to a statement of the issues involved.). Fischer could hardly have been prejudiced, see section 17A.19(1), by not having prior notice of the statutory bases for challenges he would later assert. We cannot conclude that this slight deviation from the requirements of section 17A.12 deprived the commission of jurisdiction to make a valid franchise order affecting those persons who appear and take active part in the proceedings. See and compare Golden Grain Macaroni Co. v. Federal Trade Commission, 472 F.2d 882, 886 (9th Cir.1972) (inadequacy of notice to those who appear and take part in administrative hearing does not vitiate proceedings in the absence of prejudice although a similar inadequacy of notice would vitiate proceedings as to persons who do not appear). Ordinarily, all that need be shown to validate administrative proceedings against persons who participate in a contested case hearing is that they had a reasonable opportunity to know of the claims which affect them and to meet those claims. Aloha Airlines, Inc. v. Civil Aeronautics Board, 598 F.2d 250, 262 (D.C.Cir. 1979); Swift & Co. v. United States, 393 F.2d 247, 252 (7th Cir.1968); Perry v. Planning Commission, 62 Hawaii 666, 676, 619 P.2d 95, 108 (1980); Tafaro's Investment Co. v. Division of Housing, 261 La. 183, 186, 259 So.2d 57, 60-61 (1972); 2 K. Davis Administrative Law § 8.04, at 525 (1958). In the present controversy, petitioner's complaints concern the issues of whether the proposed project was sufficiently in the public interest and whether the location of the easement was properly placed. He has had a full, fair and complete opportunity to contest the DPC's contentions as to each of these matters. We do not believe our decisions in Race v. Iowa Electric Light & Power Co., 257 Iowa 701, 134 N.W.2d 335 (1965) and Vittetoe v. Iowa Southern Utilities Co., 255 Iowa 805, 123 N.W.2d 878 (1963) require us to sustain petitioner's challenges to the commission proceedings based upon claimed inadequacies of the petition. Those cases were decided under statutes contained in Iowa Code chapter 489 (1958) which affected the grant of electrical franchises by the commission. The statutes in effect at that time required that a petition to the commission by one seeking a franchise for electric power include only those matters now contained in subsection (1) of present section 478.3 and not those additional matters required by subsection (2) of that statute. At the time the Race and Vittetoe cases were decided, all such franchise applications to the commission were required to be determined after a hearing. Unlike the present statutes, chapter 489 (1958) did not permit agency action in some cases based upon the verified petition alone. In addition, we believe it is significant that both of these cases were decided prior to the enactment of the Iowa Administrative Procedure Act now found in Iowa Code chapter 17A. In Vittetoe, the commerce commission had never made a finding of public purpose in granting the electric power franchise involved in that case. We upheld the right of a property owner whose land was taken by eminent domain for that franchise to assert the absence of public purpose as a defense to the taking of his property on an appeal from the award of damages by a condemnation commission. Race also involved a property owner's challenge to the public purpose of a proposed electric transmission line on an appeal from a condemnation award. We rejected that challenge and accepted as conclusive the commerce commission's determination of public purpose made at an administrative hearing in which the property owner had participated. Any suggestion in the latter case that, if the allegations of the petition had been inadequate, the property owner who had appeared at the hearing could have collaterally attacked the commission's public use finding on appeal from the condemnation award was not necessary to the decision. Such suggestion is now expressly disapproved. We find no merit in petitioner's challenge to the commission's order based upon an insufficiency in the petition filed by DPC.