Court Opinion

ID: 9443761
Source: CourtListenerOpinion
Date Created: 2023-08-03 19:29:57.639761+00
Date Added: 2024-06-11T17:29:35.750084
License: Public Domain

McLAUGIiLIN, Circuit Judge
(dissenting).
I cannot agree that the orders of the Commission in these two cases should be reversed. The majority opinion reads the proviso of section 7(a) of the Natural Gas Act as a general limitation on the Commission’s powers and not merely on those powers granted by section 7(a). It is stated that while section 5(a) “* * * confer[s] upon the Commission power to direct the elimination of unduly discriminatory and preferential practices * * * ” the Commission may not, in asserting this power, compel the enlargement of transportation facilities, and that its orders have “ * * * the inescapable effect of compelling the company to improve its system by its enlargement * *
The Natural Gas Act was enacted in 1938 and, with one or two minor exceptions not here relevant, lias not been amended since that date. It is admittedly in need of revision. One question arising under the Act which requires clarification was posed collaterally in Michigan Consolidated Gas Co. v. Panhandle Eastern Pipe Line Co., 6 Cir., 1949, 173 F.2d 784, and is presented here in clearer outline: the limitations on the Commission’s power to correct unlawful discrimination. The Sixth Circuit found little, if any, precedent to aid it in determining whether the Commission’s power to correct such discrimination, if asserted in such a way as 1o amount to an order of enlargement within section 7(a), would be beyond its jurisdiction. That court, however, in a well-reasoned opinion answered the question in the negative, thus concluding that the power under section 5(a) to correct discrimination prohibited by section 4(b) is not limited by the proviso of section 7(a).1 With this conclusion I agree. Were the law otherwise there would in many cases be no effective means of eliminating the unreasonable differences in service and facilities which are forbidden by section 4(b).
The above considerations aside, it would seem from the location of the proviso in section 7(a) that it was meant to apply only to those situations where the Commission, finding “such action necessary or desirable in the public interest * * * ” orders a natural gas company “to extend or improve its transportation facilities, to establish physical connection” with the facilities of *682other persons or municipalities, etc. Such orders have nothing to do with correcting or removing unlawful discrimination but deal with cases where in the public interest the Commission deems it desirable to extend or improve service. Obviously the draftsmen of the Act deliberately limited the power of the Commission in that type of case where the company’s behavior is not subject to a corrective order, while refusing to impose similar restrictions in cases where it is. At any rate, had Congress intended to apply the limitation to all orders of the Commission including those designed to correct discrimination, it could have included similar wording in the proviso of section 5(a), or at least have set out the restriction in a separate section or subsection so that its application to the entire Act would clearly appear.
Even if it be true that the proviso of section 7(a) pervades the entire Act, it is my opinion that the case should be remanded for a determination by the Commission on the question whether what Panhandle will have to do to comply with the orders of the Commission constitutes an improvement- or extension- on the one hand or an enlargement on the other, particularly as' concerns that part of the order dealing with the Louisburg lateral. As the Sixth Circuit, in considering whether the Commission or the courts should decide the question, said in the Michigan Consolidated case, supra, at page 788 of 173 F.2d:
“The first question we have to deal with is whether what Consolidated wants done at the Edgerton Station under command of court decree, constitutes on the one hand a mere extension or improvement, concededly within the power of the Commission to direct, or an enlargement which the Commission may not order. The Act nowhere defines these terms and it is somewhat baffling to determine when and under what circumstances an extension or improvement .of facilities ceases to -be such and becomes enlargement. Be that as it may, it is nevertheless clear to us that in the contemplation of an integrated facility extending across eight states, whether a few miles of extra pipe constitutes an enlargement or mere improvement, requires consideration of data and of facts and circumstances within the competency of the administrative authority entrusted with regulation rather than within the competency of the court. To inexpert judgment it may seem, without knowledge of such facts and circumstances, that the addition of pipe to an already existing and singly considered pipeline might well be an extension, even though such pipe-line lies parallel to another and the two constitute a double pipe-line. It is idle to argue that we must accept Consolidated’s designation of the construction desired by it at Edgerton as an enlargement, because at the hearing below there was no controversy about it. The Commission here challenges the designation, and in any event, we are dealing with a question of jurisdiction and it is axiomatic that jurisdiction may not be conferred upon a federal court by consent.”
By contrast, in reversing, this court assumes that an enlargement has been ordered by the Commission despite the fact that there are no Commission findings as to what must be done to correct the definite existing discrimination on the Louisburg lateral and, of course, no findings either that the remedy, whatever it might be, would constitute an enlargement. More than that, since under Section 7(a) improvements which are enlargements cannot be ordered by the Commission, the majority, by interpreting “improve” to mean the equivalent of “enlarge”, has read the former term out of section 7(a), and under its view, out of the entire Act.

. Indeed, the court said in 173 F.2d at page 789:
“Whatever may be the limits placed by the Act upon the authority of the Commission in other respects, it is clear that under § 717 e(b) [Section 4(b)] the authority of the Commission, in respect to undue preferences or advantages, is without limitation.”