Court Opinion

ID: 9627462
Source: CourtListenerOpinion
Date Created: 2023-08-22 08:44:07.749067+00
Date Added: 2024-06-11T15:42:13.178640
License: Public Domain

*57SHEPARD, Justice,
dissenting.
This action arose in 1976 when appellant Utah Power & Light applied for an increase in its rates. The commission denied a substantial portion of that requested rate increase, and an appeal to this Court followed. Utah Power & Light v. Public Util. Comm’n, 102 Idaho 282, 629 P.2d 678 (1981). Four members of this Court joined in that opinion, holding that the rates set by the commission were unjust, unreasonable, and thus confiscatory. The amount of that confiscation was in excess of six million dollars. The Court cited Inter-mountain Gas Co. v. Idaho Public Util. Comm’n, 97 Idaho 113, 540 P.2d 775 (1975), wherein a unanimous court, quoting from Bluefield Waterworks & Improvement Co. v. Public Service Comm’n of West Virginia, 262 U.S. 679, 690, 43 S.Ct. 675, 678, 67 L.Ed. 1176 (1923), stated:
“The question in the case is whether the rates prescribed in the commission’s order are confiscatory and therefore beyond legislative power. Rates which are not sufficient to yield a reasonable return on the value of the property used at the time it is being used to render the service are unjust, unreasonable and confiscatory, and their enforcement deprives the public utility company of its property in violation of the Fourteenth Amendment. This is so well settled by numerous decisions of this court that citations of the cases is scarcely necessary.” Intermountain Gas Co. v. Idaho Public Util. Comm’n, supra, 97 Idaho at 125, 540 P.2d at 787.
Hence, it was held in Utah Power & Light v. Idaho Public Util. Comm’n, supra, that the commission had unconstitutionally confiscated the property of Utah Power & Light. Upon remand to the commission, the utility petitioned for the allowance of a surcharge to recover the moneys of which it had been deprived by the commission’s previous order. Implicit in the commission’s order denying any relief is the assertion that, although Utah Power & Light has sustained a six million dollar confiscation, it shall swallow its loss — certainly a strange application of constitutional principles. I deem it even more strange that on appeal to this Court, exactly the same conclusion is reached, i.e., Utah Power & Light shall swallow its loss.
In the 18 pages of the majority opinion, there is no consideration given to whether, as contended by the commission, a surcharge is illegal and beyond the jurisdiction of the commission since it constitutes “retroactive ratemaking.” Although it is clear that the commission in the past has itself utilized surcharge rates, the majority, by grand fiat, states, “Whatever the PUC’s actions have been in the past, it now has notice that any granting of surcharges in the future will be illegal.” Not a scrap of authority is cited for such statement, nor is the reader afforded any rationale therefor.
The actions of the author of the majority opinion can perhaps be understood and accepted in view of his dissenting language when the cause was originally before the court:
“Rate-making decisions are properly to be made either by the legislature or by the Commission which the legislature created for that very purpose. To those who are dissatisfied with the Commission’s decision, other than under I.C. 61-629, it seems to me that any petition for redress should be made to the legislature itself.” Utah Power & Light v. Idaho Public Util. Comm’n, supra, 102 Idaho at 295, 629 P.2d at 691.
As to the remaining members of the majority, I can only speculate and wonder as to this unexplained deviation from their original positions.
The argument against the imposition of a surcharge in this case is two-pronged: that the commission has no jurisdiction to approve such a surcharge, and that to do so would in effect be retroactive ratemaking. As to the first prong, the commission clearly has jurisdiction, in that the surcharge is a rate and the setting of rates is statutorily within the exclusive jurisdiction of the commission. I.C. §§ 61-502, 61-503. As was stated by this Court in Washington Water Power Co. v. Kootenai Environmental Al*58liance, 99 Idaho 875, 879-880, 591 P.2d 122, 126-127 (1979):
“[Wjhile jurisdiction of the Commission is to be strictly construed once jurisdiction is clear the Commission is allowed all power necessary to effectuate its purpose. ‘Every power expressly granted, or fairly to be implied from the language used, where necessary to enable the Commission to exercise the powers expressly granted should be afforded.’ United States v. Utah Power & Light Co., supra, 98 Idaho at 667, 570 P.2d 1353...
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“The statutes reflect the legislative grant of authority to the Commission to deal broadly with existing and future rates, rates schedules and contracts affecting the rates.”
In view of the commission’s assertions of jurisdiction broad enough to encompass regulation of political mailings {see Washington Water Power Co. v. Kootenai Environmental Alliance, supra); the regulation of credit cards {see Lemhi Telephone Co. v. Mountain States Tel. & Tel. Co., 98 Idaho 692, 571 P.2d 753 (1977)); the forfeiture of water rights {see Idaho Power Co. v. State of Idaho, 104 Idaho 575, 661 P.2d 741 (1983)); the forced discontinuance of appliance sales {see Intermountain Gas Co. v. Idaho Public Util. Comm’n, 97 Idaho 113, 540 P.2d 775 (1975)); and the rate of return which may be earned by a non-utility affiliate {see Washington Water Power Co. v. Idaho Public Util. Comm’n, 105 Idaho 276, 668 P.2d 1007 (1983)), the plaintive plea of the commission, affirmed by this Court, can be characterized as nothing but ludicrous.
As to the assertion that a surcharge constitutes retroactive ratemaking, it is indeed a subject of substantial debate. However, the majority favors us with no authority, pro or con, but merely gives us its cryptic fiat. It was stated in Petition of Allied Power & Light Co., 133 Vt. 586, 350 A.2d 360, at 364 (1975), that a utility should be allowed to recoup rate increases forestalled by lengthy litigation, because “[tjo hold otherwise would be both unfair and contrary to the policy in these cases that declares in a utility a right to those rates which are determined to be just and reasonable, and permit a fair return.” In the instant ease a grant of a surcharge is the same as a final order treating the original request, rather than being a retroactive mechanism for imposing charges. Other jurisdictions have ruled such a surcharge to be permissible. Wisconsin’s Environmental Decade, Inc. v. Public Serv. Comm’n of Wisconsin, 98 Wis.2d 682, 298 N.W.2d 205 (Wis.App.1980); California Mfrs. Ass’n v. P.U.C., 24 Cal.3d 251, 155 Cal. Rptr. 664, 595 P.2d 98 (1979); Potamac Electric Power Co. v. Public Serv. Comm’n, 380 A.2d 126 (D.C.App.1977), vacated on other grounds, 402 A.2d 14, cert. denied, 444 U.S. 926, 100 S.Ct. 265, 62 L.Ed.2d 182 (1979); Duquesne Light Co. v. Pa. Pub. Util. Comm’n, 31 Pa.Cmwlth. 118, 376 A.2d 668, 670 (1977); Petition of Allied Power & Light Co., 133 Vt. 586, 350 A.2d 360 (1975); see generally Howe, Recoupment: an Experiment in Vermont, 109 Pub.Util.Fort. 58 (May 27, 1982); Rate Recoupment Authorized, 108 Pub.Util. Fort. 48 (Sept. 10, 1981); Electric Utility Emergency Surcharge Granted, 106 Pub. Util.Fort. 55 (July 31, 1980); The Problem of Retroactive Rates, 105 Pub.Util.Fort. 63 (June 19, 1980).
The essence of the majority opinion is that, since Utah Power & Light did not follow procedural niceties which, for the first time in today’s ruling, are deemed the exclusive avenue to avoid confiscation, the utility must suffer the loss. Even assuming that such argument is worthy of consideration in view of constitutional restraints, the majority’s opinion is nevertheless seriously flawed. I.C. § 61-635 is, by its express language, permissive rather than mandatory, and despite the linguistic legerdemain of the majority, the word “may” in that statute cannot somehow miraculously be turned into “must.” The majority cites, as support for its holding, Joy v. Winstead, 70 Idaho 232, 215 P.2d 291 (1950). Joy v. Winstead is clearly distin*59guishable from the instant case, and only the most myopic misreading of it gives any guidance here. In Joy, a rate had been sought from and denied by the Public Utilities Commission. The company in district court sought and gained an injunction against the Public Utilities Commission which would permit collection of the full rate increase sought. A writ of prohibition was sought in the Supreme Court, challenging the district court’s jurisdiction to so enjoin. In Joy, therefore, a stay had issued by the district court against the interim imposition of the lower rates by the commission. Hence, anything which the opinion of the Court might have implied regarding a situation involving the non-issuance of a stay is, at best, dicta not necessary to the decision. The case stands merely for the proposition that the district court had jurisdiction to grant the requested stay. If nothing else, the majority citation of Joy is startling, considering Joy’s repeated reference to the protection of constitutional rights, which reference was necessary because of the commission’s violation of due process rights in the setting of confiscatory rates.
The majority opinion argues, contrary to the express language and spirit of I.C. § 61-635, that the utility’s interests are safeguarded by the existence of the right to request, and to possibly receive, a stay by the appellate court of the commission’s order. The majority relies on the idea that the issuance of such a stay is not discretionary with the reviewing court, but is mandatory upon the utility’s demonstration of impending irreparable damages to the utility’s interests. The majority’s analysis assumes, of course, that this Court will always recognize the propriety of a stay, and that it will never erroneously deny a stay but then later rule for the utility on the merits. Does the majority imply that in every rate setting matter appealed to this Court, upon application a stay will automatically issue restraining the implementation of the rates set by the commission? If so, such will indeed be a drastic change from the practice and procedure of public utility law in the State of Idaho.
In brief, it is my view that the rates set by the commission are confiscatory and in violation of the constitutional rights of Utah Power & Light. This Court, in spite of its fine record of concern for constitutional rights in every other area of the law, announces that it must stand helplessly by because of obscure, ambiguous procedural nuances. I cannot agree.
The majority’s result is particularly difficult to understand in view of Frizzell v. Swafford, 104 Idaho 823, 663 P.2d 1125 (1983), wherein the Court held unconstitutional a requirement that a bond be posted to effectuate an appeal. I would again set aside the order of the commission and remand with clear instructions that a temporary surcharge be established in such amount and for such period of time as will allow the utility to recoup its loss.
BAKES, J., concurs.