Court Opinion

ID: 9847625
Source: CourtListenerOpinion
Date Created: 2023-09-24 04:03:34.434995+00
Date Added: 2024-06-11T09:17:23.766033
License: Public Domain

Justice MARTIN
dissenting in part and concurring in part.
I dissent as to the majority’s holding on the first issue. The Commission found that the service of Glendale was inadequate, both as to water quality and service provided. The litany of Glendale’s transgressions against its consumers is set forth in the majority opinion. Not only has Glendale failed to provide proper *49service, in at least fifteen of its service areas it does not have the necessary water treatment equipment to render proper service if it were inclined to do so. The evidence concerning the inadequacy of Glendale’s service and the danger to the health of its consumers is both overwhelming and uncontradicted. There is no evidence in this record that Glendale has done anything to correct these problems, except to have a witness testify that he was aware of the existing water quality and service problems and that if he were allowed to purchase the controlling stock in the company, he would take corrective measures. There is no evidence that Glendale has acquired a single piece of chlorination equipment for use in the fifteen subdivisions that it serves which have no such equipment. There is no evidence that Glendale has taken any steps to protect the water quality, to improve the water quality, to reduce water outages, to clear the water discoloration, to prevent the staining of fixtures, to provide proper pressure, to reduce the odor of chlorine, to put chlorine in the water when required, to properly maintain the electric wiring, to improve its billing practices, to respond to the customer needs and complaints, and to provide consumers with prompt “boil notices” to warn of contaminated water. In short, Glendale comes before the Commission and this Court asking for the approval of a 14.56 percent increase in rates without any corresponding effort on its part to improve the services to its consumers, who are now being asked to pay additional amounts for the same poor, inadequate service.
I do not find that upon the whole record test the findings of the Commission are adequate or are supported by competent, material, and substantial evidence. N.C.G.S. § 62-94(b)(4), (5), (6) (1982). It is apparent to me that upon this record the decision of the Utilities Commission was arbitrary or capricious.
Prior to the present application, the Commission had established rates for Glendale which were sufficient to enable it to maintain its properties, render proper and adequate service to its consumers, and, in addition, earn a fair return. Glendale must accept responsibility for its actions in allowing its properties to deteriorate and in failing to provide adequate service and water of acceptable quality. Having been granted a monopoly in its franchise area, Glendale is under a duty to render reasonably adequate service. Utilities Comm. v. Morgan, Attorney General, 277 *50N.C. 255, 177 S.E. 2d 405 (1970), aff’d on reh’g, 278 N.C. 235, 179 S.E. 2d 419 (1971).
Rates charged by a utility and service rendered go hand in hand:
(a) Every rate made, demanded or received by any public utility, or by any two or more public utilities jointly, shall be just and reasonable.
(b) Every public utility shall furnish adequate, efficient and reasonable service.
N.C.G.S. § 62-131 (1982). The quality of service rendered is a necessary factor to be considered in fixing just and reasonable rates. Utilities Comm. v. Telephone Co., 285 N.C. 671, 208 S.E. 2d 681 (1974). When the Commission found that Glendale’s service was inadequate, it was required to make specific findings showing the effect of this inadequacy upon its decision to fix rates fair to both Glendale and the consumer. Utilities Comm. v. Telephone Co., 281 N.C. 318, 189 S.E. 2d 705 (1972). I find no such specific findings. Without such findings the decision of the Commission is arbitrary or capricious. The agency decision does not indicate a fair and careful consideration of the issue, nor does it indicate a course of reasoning and the exercise of judgment. The award of the Commission must be based upon reasoned decision making. Comr. of Insurance v. Rate Bureau, 300 N.C. 381, 269 S.E. 2d 547, reh’g denied, 301 N.C. 107 (1980).
The Commission had the authority, upon the filing of the application by Glendale, to suspend the hearing pending the improvement of service by Glendale to its consumers. Upon such performance by Glendale, the Commission could then hear and determine the proper rate of return based upon such improved service. In the light of the history of Glendale’s performance of its duties as a public utility and its abject failure to provide its consumers with a reliable, potable source of drinking water, the Commission acted arbitrarily or capriciously in relying upon the promises of a witness who was not even the owner of the company but only a person interested in acquiring the company. I find that the Commission erred in granting the increase in rates and vote to have the case remanded to the Commission on this issue, with instructions to vacate the order approving the increased *51rates and hold the proceedings of the Commission in suspension until the new owner demonstrates his ability to carry out his promises for improved water quality and service; or, at the very least, for additional findings of fact necessary to support the conclusions of the Commission as being the product of reasoned decision making. Upon this record, the consuming public is entitled to a reliable source of potable drinking water before there should be additional increases in the consumers’ costs.
I concur in the remainder of the majority opinion.