Court Opinion

ID: 9695880
Source: CourtListenerOpinion
Date Created: 2023-08-25 18:30:50.039652+00
Date Added: 2024-06-11T18:20:17.061675
License: Public Domain

*668Shanahan, J.,
concurring.
Injunctive relief for K N Energy, Inc., is the correct disposition of this appeal. However, in reaching the correct result, the majority refers to the content of the Nebraska Municipal Natural Gas Regulation Act, Neb. Rev. Stat. §§ 19-4601 et seq. (Reissue 1987), enacted in 1987; for example, “There is no mention in [the act] of short-term debt as a component of capital structure to be considered in establishing a [reasonable] rate of return,” and “The státute makes no other mention of short-term debt as a cost of capital or a consideration in finding a proper rate of return.” By those and other references to the content of the Nebraska Municipal Natural Gas Regulation Act, the majority has attributed unnecessary and unwarranted significance to the act in relation to this appeal.
Quite apart from the Nebraska Municipal Natural Gas Regulation Act, the true foundations for injunctive relief regarding a utility rate are the guarantee of due process, see Neb. Const. art. I, § 3, and U.S. Const. amend. XIV, and a district court’s constitutionally conferred equity jurisdiction, namely: “The district courts shall have both chancery and common law jurisdiction____” Neb. Const. art. V, § 9.
On several occasions, this court has reiterated the longstanding constitutional premise that pursuant to the power conferred by Neb. Const. art. V, § 9, a district court has equity jurisdiction, which exists independent of statute and is exercisable without legislative enactment. See, State, ex rel. Sorensen, v. Nebraska State Bank, 124 Neb. 449, 247 N.W. 31 (1933); State v. Odd Fellows Hall Ass’n, 123 Neb. 440, 243 N.W. 616 (1932); Hall v. Hall, 123 Neb. 280, 242 N.W. 607 (1932); Matteson v. Creighton University, 105 Neb. 219, 179 N.W. 1009 (1920).
In Bluefield Co. v. Pub. Serv. Comm., 262 U.S. 679, 690, 43 S. Ct. 675, 67 L. Ed. 1176 (1923), the U.S. Supreme Court stated: “[WJhether the rates prescribed in the commission’s order are confiscatory and therefore beyond legislative power” depends on whether the imposed rates are “confiscatory, and their enforcement deprives the public utility of its property in violation of the Fourteenth Amendment.” Injunctive *669protection for a utility concerning a confiscatory rate was acknowledged in Kansas-Nebraska Natural Gas Co. v. City of St. Edward, 167 Neb. 15, 23, 91 N.W.2d 69, 74 (1958), when this court recognized the availability of an injunction as part of a district court’s equity jurisdiction to prevent “ ‘unreasonable delay in putting an end to confiscatory rates ....’” (Quoting from Smith v. Ill. Bell Tel. Co., 270 U.S. 587, 46 S. Ct. 408, 70 L. Ed. 747 (1926).)
After an examination of the Nebraska Municipal Natural Gas Regulation Act in relation to the present appeal, the words of Daniel Webster, echoing Brougham’s observation, are indeed appropriate: “What is valuable is not new, and what is new is not valuable.” The valuable constitutional role of the judiciary in connection with the ratemaking process is not new. See, Bluefield Co. v. Pub. Serv. Comm., supra; Kansas-Nebraska Natural Gas Co. v. City of St. Edward, supra. The recently enacted Nebraska Municipal Natural Gas Regulation Act has little value, if any at all, concerning judicial activity in reference to the ratemaking process, which still remains a legislative function or activity. See Kansas-Nebraska Nat. Gas Co., Inc. v. City of Sidney, 186 Neb. 168, 181 N.W.2d 682 (1970). Any legislative attempt to involve a court in establishing a utility rate has serious constitutional implications.
Under the circumstances in the present appeal, municipal failure to adopt an ordinance affording a reasonable rate of return on the value of K N’s property used for public service imposed a confiscatory rate on K N and is state action which deprives K N of its property, contrary to the constitutional guarantee of due process. Injunctive relief prevents such unconstitutional confiscation.
Even if the Nebraska Municipal Natural Gas Regulation Act had never been enacted, the injunction granted to K N would be constitutionally authorized and available in a district court’s equity jurisdiction. Any use of the act to determine the present appeal is seduction by legislation.
Caporale, J., joins in this concurrence.