Court Opinion

ID: 9534169
Source: CourtListenerOpinion
Date Created: 2023-08-07 04:37:20.275945+00
Date Added: 2024-06-11T13:27:28.557574
License: Public Domain

FELDMAN, Vice Chief Justice,
concurring.
I concur in the result. The trial court granted a motion to dismiss, essentially-holding that it had no jurisdiction. Plaintiffs alleged in the complaint that the city had set rates that were both discriminatory and unreasonable for non-residents of the municipality. Basing its argument on City of Phoenix v. Kasun, 54 Ariz. 470, 97 P.2d 210 (1939), the city contends that the rates are solely a matter of contract and that the court cannot make rates. In my view, the argument is incorrect — a great deal of difference exists between judicial ratemaking and judicial review of rates set by the utility.
Basically, I agree with the court of appeals. Given A.R.S. § 9-516(C) and (D), which prevent municipal water utilities from discontinuing service to current subscribers located outside the municipality’s boundaries, and the corporation commission from granting certificates of convenience and necessity to any potential water utility competitors, Kasim’s contract theory — prohibiting judicial review of rates set by the city — is no longer good law.
Because the city chose to serve the subscribers, because the law prevents discontinuance of such service, and because the city has a virtual monopoly in the provision of services, I believe the city subjects itself to the common law duties of those who provide essential services to others. Village of Niles v. City of Chicago, 82 Ill.App. 3d 60, 68, 37 Ill.Dec. 142, 147, 401 N.E.2d 1235, 1240 (1980) (common law of utilities law provides that a “city is subject to the same rules that would apply to a privately owned utility,.[ jincluding those forbidding unreasonableness and discrimination in utility rates[ ].”) (citations omitted); see generally E. McQUILLIN, LAW OF MUNICIPAL CORPORATIONS §§ 34.158, at 403, and 35.37a, at 616 (3d ed. 1986). Thus, the city may be enjoined from setting discriminatory or unreasonable rates. Furthermore, under proper circumstances, the city may be responsible in damages.
I believe that all we need to say here is that the plaintiffs have stated a cause of action, and the judgment of dismissal must be reversed. What theories are applicable, and what relief ought to be granted cannot be decided unless and until the facts are proved in the trial court.