Court Opinion

ID: 4396403
Source: CourtListenerOpinion
Date Created: 2019-05-14 13:42:26.22448+00
Date Added: 2024-06-11T14:52:10.425561
License: Public Domain

IN THE COMMONWEALTH COURT OF PENNSYLVANIA

New Garden Township,                            :
                              Appellant         :
                                                :
               v.                               :    No. 261 C.D. 2018
                                                :    Argued: March 12, 2019
Artesian Resources Corporation, Inc.,           :
Artesian Water Pennsylvania, Inc.,              :
Artesian Water Company, Inc., and               :
Charles L. Wilkenson Broad Run                  :
Valley, Inc.                                    :

BEFORE:        HONORABLE ROBERT SIMPSON, Judge
               HONORABLE MICHAEL H. WOJCIK, Judge
               HONORABLE CHRISTINE FIZZANO CANNON, Judge

OPINION NOT REPORTED

MEMORANDUM OPINION
BY JUDGE SIMPSON                                FILED: May 14, 2019

               New Garden Township (Township) appeals an order of the Court of
Common Pleas of Chester County (trial court) that denied its post-trial motions
following a non-jury verdict in favor of Artesian Resources Corporation, Inc.
(Artesian Resources), Artesian Water Pennsylvania, Inc. (Artesian PA), Artesian
Water Company, Inc. (AWC), Charles L. Wilkinson1 (Landowner), and Broad Run
Valley, Inc. (Broad Run Valley) (collectively, Appellees). The Township initiated
this action by filing a declaratory judgment suit to determine its authority to enforce
its local ordinances against Appellees, some of which are public utilities. On appeal,
the Township asserts it has the right to enforce its ordinances on property in the
Township where the property owners are private landowners and not public utilities,

       1
          Although the caption refers to Appellee “Charles L. Wilkenson,” the parties’ briefs, the
trial court opinion, and the trial court transcript refer to Appellee “Charles L. Wilkinson.”
and the private landowners relied on a Certificate of Public Convenience (CPC)
issued by the Pennsylvania Public Utility Commission (PUC) to an entity with no
interest in the property. It also argues private landowners cannot claim exemption
from the Township’s ordinances as to work performed on their property where the
CPC upon which they relied did not include the property at issue within its scope,
and the PUC rejected the CPC holder’s attempt to have the property included in the
scope of its CPC. Upon review, we are concerned that the PUC possesses primary
jurisdiction over a key issue in this case; thus, we vacate and remand to the court of
original jurisdiction to make an inital determination whether to apply the doctrine of
primary jurisdiction, thereby allowing the PUC to first resolve the essential issue of
the scope and status of the CPC.

                                   I. Background
             The trial court made the following findings. The Township is a second
class township in Chester County. Artesian Resources is a Delaware Corporation
and holding company. AWC is a Delaware corporation that is wholly owned by
Artesian Resources. Artesian PA is a Pennsylvania corporation that is wholly owned
by Artesian Resources.

             Landowner owns properties in the Township, including tax parcel 60-
6-7.2, which is comprised of approximately 5.5 acres. Broad Run Valley is a
Pennsylvania corporation with its principal place of business in the Township; it
owns tax parcel 6-5-167.1, which is comprised of approximately 49.9 acres. The
two tax parcels are adjacent properties with frontage on Broad Run Road
(collectively, the property).

                                          2
             In 2001, Broad Run Valley, Landowner, and Artesian Resources
entered into an Easement Agreement (2001 Easement) to permit Artesian Resources
access over properties owned by Broad Run Valley and Landowner. The 2001
Easement also granted Artesian Resources the right to access a well by travelling
over the properties. The 2001 Easement states, in pertinent part:

             12.4 Assignment. This Agreement shall be binding upon
             and inure to the benefit of the respective successors and
             assigns of the parties hereto. Neither party may transfer or
             assign this Agreement or its rights hereunder or delegate
             its performance hereunder without prior written consent of
             the other party, which consent will not be unreasonably
             withheld; provided, however, that Artesian Resources has
             the right, without the approval of Grantor to consummate
             the transactions contemplated herein through the use of a
             subsidiary or other affiliate acquisition entity.

Tr. Ct., Slip Op., 10/19/17, Finding of Fact (F.F.) No. 10 (quoting Ex. P-6 at ¶12.4
(emphasis in original).

             In 2002, Broad Run Valley and Artesian Resources entered into an
agreement, titled, Easement for Water Facilities (2002 Easement), which states, as
relevant:

            7. Assignment. This Agreement may be assigned or
            transferred by Artesian Resources without the prior
            approval of the Owner.

F.F. No. 11 (quoting Ex. P-7 at ¶7).

             Artesian PA enjoys a CPC issued by the PUC to provide water service
to 38 residences in the Township (service area) pursuant to the PUC’s July 2002
order. In September 2002, Artesian PA filed with the PUC its affiliated interest

                                          3
agreement with AWC, titled “Management Services and Operations Agreement.”
F.F. No. 13 (citing Ex. D-5). Approximately three months later, the PUC approved
the Management Services and Operations Agreement. Artesian PA obtains water
for its service area through an interconnection with the AWC system under the terms
of the Management Services and Operations Agreement.

             Pursuant to the Delaware River Basin Compact (Compact) entered into
by the States of Delaware, New Jersey, New York, the Commonwealth of
Pennsylvania, and the United States in 1961, and its regulations, the Delaware River
Basin Commission (DRBC) has the power to allocate waters in excess of 100,000
gallons per day over a 30-day monthly average that can be withdrawn from wells in
the Delaware River Basin.

             In December 2015, the DRBC approved, subject to certain terms and
conditions, an allocation of groundwater that could be withdrawn from the well on
the property, subject to testing and other requirements. The DRBC’s approval
requires only that the “docket holder” obtain “all necessary permits and/or approvals
from other State, Federal or local government agencies having jurisdiction over this
project[.]” F.F. No. 18 (quoting Ex. D-7 at 20).

             Pending before the PUC is Artesian PA’s application for approval of
the proposed assignment of the 2001 and 2002 Easements and related agreements
from Artesian Resources to Artesian PA. Water from the well on the property, as
the closest water source for Artesian PA’s customers, will provide an important

                                         4
means of ensuring safe and reliable water service to Artesian PA’s customers in the
service area.

                In February 2016, Artesian PA entered into a contract with Austin &
Bednash Construction, Inc. (Contractor) to install approximately 180 feet of eight-
inch pipe (the main) near the well on the property to the edge of the right-of-way of
Broad Run Road (the work). The work is only part of the planned work to complete
connection of the well on the property to the facilities of Artesian PA and AWC.
Contractor performed the work from February 20 and 21, 2016, and Artesian PA
paid Contractor for the work. The work was intentionally designed and performed
so that trenching for the pipe would be less than 3 feet in vertical depth and less than
1,000 square feet of earth would be disturbed. The main is neither connected to the
well on the property nor to the system of Artesian PA or AWC, and it was capped at
both ends since the work was completed.

                Some Township residents observed the work as it was proceeding and
contacted a Township Supervisor, prompting the Township Supervisor to visit the
property. The Township Supervisor initially told Contractor to stop the work, but
after a discussion with a principal of Contractor and others, the Township Supervisor
told Contractor the work could proceed. Artesian PA installed and owns the main.

                In February 2016, the Township Zoning Officer issued Broad Run
Valley and Landowner a notice of violation. The notice of violation made no final
determination about whether the work violated any Township ordinance.

                                           5
             In March 2016, the Township filed a declaratory judgment suit seeking
declarations that: (1) Landowner, Broad Run Valley, Artesian Resources, and AWC
are subject to the Township’s zoning and lot alteration ordinances as to any and all
work performed on the property; and (2) the CPC held by Artesian PA is not a basis
on which to exempt its parent corporation, Artesian Resources, or Landowner, Broad
Run Valley, or AWC, from the Township’s zoning and lot alteration ordinances.

             Appellees filed an answer with new matter and a counterclaim.
Appellees’ counterclaim sought a declaration that, under Pennsylvania law, the
Township’s zoning and other ordinances did not apply to Artesian PA’s
undertakings in connection with the well on the property. Appellees also sought
injunctive relief to bar the Township from all attempts to regulate or interfere with
the well and work related to the well and the interconnection with Artesian PA’s
facilities, so long as it was operated by a Pennsylvania public utility or an entity
acting on behalf of a Pennsylvania public utility. The Township filed an answer to
the counterclaim and a reply to new matter. The case proceeded to a non-jury trial.

             After trial, the trial court issued a decision in which it made the
following conclusions of law. It is well-settled that municipalities have no power to
regulate or zone with respect to public utility facilities. The power to regulate such
facilities rests exclusively with the PUC. Duquesne Light Co. v. Borough of
Monroeville, 298 A.2d 252 (Pa. 1972); Duquesne Light Co. v. Upper St. Clair Twp.,
105 A.2d 287 (Pa. 1954). The PUC is given this power because subjecting public
utilities to a collection of local regulations would unnecessarily burden and
potentially disable a public utility from its mission. S. Coventry Twp. v. Phila. Elec.

                                          6
Co., 504 A.2d 368 (Pa. Cmwlth. 1986); see also Commonwealth v. Delaware &
Hudson Ry. Co., 339 A.2d 155, 157 (Pa. Cmwlth. 1975) (“[P]ublic utilities are to be
regulated exclusively by an agency of the Commonwealth with state-wide
jurisdiction rather than by a myriad of local governments with different
regulations.”).   Thus, municipalities lack power to regulate utility facilities.
Newtown Twp. v. Phila. Elec. Co., 594 A.2d 834 (Pa. Cmwlth. 1991).

             Before the trial court, the Township argued that the PUC had exclusive
regulatory authority over a public utility only within the public utility’s service
territory as defined in its CPC. The trial court disagreed, observing no distinction
between regulation inside or outside of a service territory. The trial court explained
that the purpose of Pennsylvania’s regulatory scheme would be thrown into disarray
and public utilities would regularly be hauled into court if municipalities could gain
regulatory jurisdiction simply by asserting, as the Township did here, that a public
utility exceeded the scope of its CPC.

             The Township also argued it could bypass the primacy of the PUC’s
authority to regulate public utilities by citing the property owner and not the utility
for violations of its zoning ordinance. If that was the case, the trial court stated, the
purpose of statewide regulation of utilities would easily be defeated each time a
utility performed work with a property owner’s permission that in some manner
violated a municipality’s zoning ordinance.

             The Township further argued that the failure of Artesian Resources and
Artesian PA to obtain the PUC’s approval to transfer ownership rights in the 2001

                                           7
and 2002 Easements prior to performing the work was critical. The Township
asserted that, absent such approval, public utilities could not claim to be exempt from
zoning ordinances. The trial court rejected these assertions based on our Supreme
Court’s decision in Duquesne Light Co. v. Upper St. Clair Township. There, the
Court affirmed the primacy of the PUC’s authority to regulate public utilities by
holding that the township could not enforce its zoning law, stating, “[i]n the absence
of a clear expression of intent on the part of the legislature to authorize a municipal
subdivision by zoning ordinance to regulate a public utility, no such power can be
implied.” Id. at 293-94.

              The trial court further explained that in Borough of Phoenixville v.
Pennsylvania Public Utility Commission, 280 A.2d 471 (Pa. Cmwlth. 1971), this
Court held that when a municipality renders uncertificated, extraterritorial water
service, the PUC has authority to order extensions of the extraterritorial service nunc
pro tunc as long as the ordered extensions are reasonable. Therefore, a public
utility’s actions taken prior to PUC approval do not bar a positive outcome for the
public utility.

              The trial court determined that the Township did not identify a clear
expression of intent on the part of the legislature to authorize it to regulate public
utilities, such as Artesian Resources, AWC, and Artesian PA, by zoning ordinance
when engaged in the development of facilities. Because no such power can be
implied, the trial court stated, it was incumbent on the Township to identify its
authority and the Township did not do so.

                                          8
             The trial court further stated that the declarations sought by the parties
in the complaint and counterclaim concerned matters that were properly before the
PUC for determination. For these reasons, the trial court entered a decision in favor
of Appellees and against the Township on the complaint.

             The Township filed post-trial motions, which the trial court denied.
The Township subsequently appealed to this Court, and the trial court directed it to
file a concise statement of the errors complained of on appeal, which it did. The trial
court then issued a brief opinion pursuant to Pennsylvania Rule of Appellate
Procedure 1925(a) further explaining the basis for its decision. It stated:

             During the pendency of post-trial matters, on December 7,
             2017, the [PUC] ruled on Artesian PA’s appeal that had
             been pending before it. The litigants before us have vastly
             different interpretations of the meaning of the [PUC’s]
             ruling; however, we have concluded that [Appellees]
             correctly set forth the meaning of this ruling. Accordingly,
             the issues raised by the Township in its post-trial motion
             that were based on the December 7, 2017 ruling were also
             rejected.    Proceedings before the [PUC] have not
             concluded and it is there that matters related to the well
             must be decided. …

Tr. Ct., Slip Op., 3/13/18, at 1-2 (emphasis added).

                                      II. Issues
             On appeal, the Township asserts it has the right to enforce its ordinances
on property located in the Township where the property owners are private
landowners and not public utilities, and the private landowners relied on a CPC
issued to an entity with no interest in the property. It also argues private landowners
cannot claim exemption from the Township’s ordinances as to work performed on

                                          9
their property where the CPC upon which they rely does not include the property at
issue within its scope, and the PUC rejected the CPC holder’s attempt to have the
property included in the scope of its CPC.

                                  III. Discussion
                                  A. Contentions
             Although the parties’ briefs address several issues, importantly, they
dispute the status of Artesian PA’s application seeking PUC approval of the
affiliated interest agreements between Artesian PA and its parent affiliate, Artesian
Resources. The affiliated interest agreements are assignment agreements that assign
from Artesian Resources to Artesian PA the 2001 and 2002 Easements regarding the
well and its attendant facilities. Reproduced Record (R.R.) at 720a, 726a-27a.

             On this issue, the Township argues, the trial court improperly relied on
the fact that Artesian PA directed the work on the property that led to the notice of
violation and in finding that, as a result, Artesian PA’s status as a public utility
extended immunity over Landowner and Broad Run Valley as to any violations. The
Township asserts the undisputed evidence established Artesian PA owned no
easement or other property rights to the property on February 20, 2016, when it
purportedly directed the performance of the work. See R.R. at 67a, 68a-69a, 117a,
204a-52a, 253a-60a.

             The Township further contends the evidence established that an
assignment of the easement agreements between Artesian Resources, Landowner,
and Broad Run Valley to Artesian PA was predicated on application and approval
by the PUC, which was not obtained at the time of trial and was later specifically

                                         10
rejected by the PUC. See R.R. at 67a, 73a-75a, 81a, 261a-62a, 327a-444a. Thus,
the Township maintains, Artesian PA had no right to the property when the work
was performed.

             The Township further argues the trial court erred in failing to recognize
Artesian PA’s CPC did not and does not include the geographic territory where the
work was performed. R.R. at 66a-67a, 70a, 74a-75a, 115a, 261a-62a, 266a-319a,
327a-444a. Indeed, the Township maintains, not only did the evidence establish the
well and water main assets on the property were outside the geographic territory of
Artesian PA’s CPC, but, more importantly, the evidence established approval must
first be obtained for Artesian PA to complete any work on the well and water main
pursuant to Section 1102 of the Public Utility Code, 66 Pa. C.S. §1102.

             The Township further argues that, after trial, in December 2017, the
PUC rejected Artesian PA’s request for approval of the assignment agreement. Not
only does this fact completely undermine Appellees’ defense that approval of the
affiliated services agreement was “pending,” or that Appellees’ request for approval
of that agreement was forthcoming, the Township asserts, it establishes the territory
where the well is located is not within the service area contemplated by Artesian
PA’s CPC. Appellant’s Br. at 17. Indeed, the Township contends, the PUC
condemned the Artesian Appellees’ conduct in acting as if they were already granted
the rights they seek. See R.R. at 745a. In fact, it maintains, the PUC actually referred
the matter to its Bureau of Investigation and Enforcement. R.R. at 746a.

                                          11
             The Township argues these facts establish that, at the time construction
relating to the well began on the property, Artesian PA did not have PUC approval
to render service beyond the territory defined in its CPC. Further, the Township
asserts, in the PUC’s view, Artesian PA has a specific territory within which it is
permitted to perform work under its CPC and that territory does not include the area
where the well is located. The Township asserts the fact that the PUC rejected
Artesian PA’s attempted assignment pursuant to Section 2102(a) of the Public
Utility Code, 66 Pa. C.S. §2102(a), and classified the request as an application
requiring Artesian PA to obtain a CPC pursuant to Section 1102 of the Public Utility
Code, R.R. at 77a-78a, 445a, undermines the validity of Appellees’ arguments,
which the trial court accepted, that the issuance of a CPC provides the entity that
receives a CPC carte blanche to perform work anywhere in the state.

             The Township asserts it is beyond dispute that Artesian PA has no
relationship to the property, and its claim that the PUC would approve its attempt to
obtain an ownership interest in the property was incorrect. The Township contends
the PUC’s rejection of Artesian PA’s attempt to transfer its property interests renders
Artesian PA a legal stranger to this action. Thus, the Township maintains, if this
Court does not reverse the trial court and issue an order granting the Township the
relief it seeks, it would be condoning the very illegality the PUC recently
condemned.

             Appellees respond that the Township’s position omits the complete
procedural status of Artesian PA’s pending application before the PUC. Appellees
assert Artesian PA filed an application with the PUC in March 2016 for regulatory

                                          12
approval to transfer (via assignment agreements) the lease and easement rights
relating to the well from Artesian PA’s parent, Artesian Resources, to itself. R.R. at
99a-100a. Appellees contend PUC approval of such assignment agreements is
required by Chapter 21 of the Public Utility Code, 66 Pa. C.S. §§2101-2107, which
addresses affiliated interest transfers. Appellees maintain the Township incorrectly
claims the PUC rejected Artesian PA’s application, and the PUC directed Artesian
PA to refile an application pursuant to Section 1102 of the Public Utility Code, 66
Pa. C.S. §1102.

             To the contrary, Appellees argue, the PUC did not reject Artesian PA’s
affiliated interest application to assign easement agreements from Artesian
Resources to Artesian PA. Rather, they assert, it was PUC Staff (Staff) that issued
the dismissal letter the Township references, and Artesian PA promptly appealed
that administrative action.

             Appellees contend that on December 7, 2017 (after the trial in this suit
occurred), the PUC ruled on Artesian PA’s appeal of Staff’s dismissal. By granting
in part and denying in part Artesian PA’s appeal, Appellees maintain, the PUC
rescinded Staff’s letter that purported to dismiss Artesian PA’s affiliated interest
application, and ruled that the application would proceed to conclusion. R.R. at
746a. Appellees argue the PUC further directed Artesian PA to submit supplemental
information through which the PUC could assess the application under Section
1102(a)(3) of the Public Utility Code, 66 Pa. C.S. §1102(a)(3), which Appellees
claim, Artesian PA did. R.R. at 747a.

                                         13
             Appellees assert the Township has actual knowledge that its statements
that the PUC rejected Artesian PA’s assignment application are inaccurate because
the Township later intervened in the PUC proceeding. Appellees contend that on
April 13, 2018 (more than two weeks before the Township filed its brief here), the
Township publicly filed a prehearing memorandum, see Appellees’ Br., App. A, in
which it argued the PUC should deny Artesian PA’s request to transfer the easement
agreements from Artesian Resources to Artesian PA. Appellees maintain the
Township would not ask the PUC to reject Artesian PA’s application if the PUC had
already rejected that request, as the Township incorrectly claims.

             Regardless, Appellees argue, Staff’s basis for attempting to dismiss
Artesian PA’s affiliated interest application had nothing to do with service territory
as the Township incorrectly claims. Rather, they assert, the PUC concluded the lease
and easement rights were interests in real property that are used or useful in public
service and of sufficient value to fall within the ambit of Section 1102 of the Public
Utility Code, 66 Pa. C.S. §1102, which requires utilities to obtain a CPC before they
may own certain assets. As with the PUC granting Artesian PA a CPC in 2002 to
own and operate, among other things, a water main outside its service area,
Appellees contend, the fact that the PUC is willing to assess Artesian PA’s
application to own the easement rights, even though Artesian PA will not have a
service territory that directly abuts the well, proves Artesian PA’s public utility
status applies throughout the Commonwealth and not just in its certificated service
area as the Township erroneously claims.

                                         14
                                     B. Analysis
             Upon review, we are concerned that primary jurisdiction over Artesian
PA’s application seeking approval of the affiliated interest agreements lies with the
PUC, and that a court of original jurisdiction should await the PUC’s decision on
that application before addressing the remaining issues raised by the parties.

             “[P]rimary jurisdiction” is a “judicially created doctrine that allows
courts to make a workable allocation of business between themselves and agencies
responsible for the regulation of certain industries, and arises where the original
jurisdiction of the court is being invoked to decide the merits of the controversy.”
Bean v. Dep’t of State, State Bd. of Funeral Dirs., 855 A.2d 148, 152 (Pa. Cmwlth.
2004) (en banc). Rather than exercising its own jurisdiction, the court declines
jurisdiction because it is proper to defer to the administrative agency’s jurisdiction.
Id.   “Primary jurisdiction is exclusive jurisdiction because the agency has
jurisdiction over the cause of action to which a decision of the court is relevant, and
the jurisdiction of the court will extend to the remaining issues and the relief to be
granted.” Id. (citation omitted).

             Thus, “the doctrine of primary jurisdiction permits the bifurcation of a
plaintiff’s claim, whereby a [court], faced with a claim requiring the resolution of an
issue that is within the expertise of an administrative agency, will first cede the
analysis of the issue or issues to that agency.” Erie Ins. Exchange ex rel. Sullivan v.
Pa. Ins. Dep’t, 133 A.3d 102, 107 (Pa. Cmwlth. 2016) (en banc) (quoting Pettko v.
Pa. Am. Water Co., 39 A.3d 473, 479 (Pa. Cmwlth. 2011)). “Once the agency
resolves the particular issue or issues over which it has primary jurisdiction, the

                                          15
[court] may proceed, if necessary, to apply the agency’s decision to the dispute
remaining before the [court].” Id.

            In Bean, this Court further explained:

                  Although the primary jurisdiction doctrine was
            originally a federal doctrine that was established by the
            United States Supreme Court in Texas [& Pacific
            Railway] v. Abilene Cotton Oil Co., [204 U.S. 426,
            (1907)], our Supreme Court adopted it in Weston v.
            Reading Co., [282 A.2d 714 (Pa. 1971)], and further
            explained it in Elkin v. Bell Telephone of [Pennsylvania],
            [420 A.2d 123, 371-376 (Pa. 1980)], as follows:

                   The principles of the doctrine of primary
                   jurisdiction are well settled. The United States
                   Supreme Court ‘… recognized early in the
                   development of administrative agencies that
                   coordination between traditional judicial machinery
                   and these agencies was necessary if consistent and
                   coherent policy were to emerge. The doctrine of
                   primary jurisdiction has become one of the key
                   judicial switches through which this current has
                   passed.’     The doctrine ‘… requires judicial
                   abstention in cases where protection of the integrity
                   of a regulatory scheme dictates preliminary resort to
                   the agency which administers the scheme.’
                   (Citations omitted.)

                   Our Supreme Court went on to explain its effect,
            stating:

                   It is equally important to realize what the doctrine
                   is not—it is not simply a polite gesture of deference
                   to the agency seeking an advisory opinion wherein
                   the court is free to ignore the agency’s
                   determination. Rather, once the court properly
                   refers a matter or a specific issue to the agency, that
                   agency’s determination is binding upon the court
                   and the parties (subject, of course, to appellate

                                         16
      review through normal channels), and is not subject
      to collateral attack in the pending court proceeding.
      ‘The common law doctrine of res judicata,
      including the subsidiary doctrine of collateral
      estoppel, is designed to prevent the relitigation by
      the same parties of the same claim or issues.’ K.C.
      Davis, Administrative Law, § 181.10 (1972). Once
      the administrative tribunal has determined the
      issues within its jurisdiction, then the temporarily
      suspended civil litigation may continue, guided in
      scope and direction by the nature and outcome of
      the agency determination.

Feingold v. Bell of [Pa., 383 A.2d 791, 801 (Pa. 1977)]
(Pomeroy, J., dissenting).

      In Poorbaugh v. Pennsylvania Public Utility
Commission, 666 A.2d 744 (Pa. Cmwlth. 1995), [appeal
denied, 678 A.2d 367 (Pa. 1996)], we further explained the
doctrine as follows:

             Essentially, the doctrine creates a workable
      relationship between the courts and administrative
      agencies wherein, in appropriate circumstances, the
      courts can have the benefit of the agency’s view on
      issues within the agency’s competence. (Citations
      omitted.)

             The doctrine of primary jurisdiction requires
      judicial abstention in cases where protection of the
      integrity of a regulatory scheme dictates
      preliminary resort to the agency which administers
      the scheme. (Citations omitted.) Our Supreme
      Court stated in Elkin that the doctrine serves several
      purposes, chief of which are the benefits to be
      derived by making use of the agency’s special
      experience and expertise in complex areas with
      which judges and injuries have little familiarity. Id.
      Another important consideration is the need to
      promote consistency and uniformity in certain areas
      of administrative policy. [Id. at 376]. Once the
      administrative tribunal has determined the issues
      within its jurisdiction, then the temporarily

                            17
                    suspended civil litigation may continue, guided in
                    scope and direction by the nature and outcome of
                    the agency determination. Elkin, [420 A.2d at 377].

             Id., 666 A.2d at 749. Therefore, when primary jurisdiction
             is conferred on an administrative agency, usually the
             following elements are present:

                    1. The industry is a heavily regulated industry;

                    2. To resolve the matter at issue requires a special
                    expertise that resides within the agency;

                    3. The issue is fact specific and ordinarily requires
                    voluminous and conflicting testimony to resolve it;

                    4. The administrative agency was created to address
                    and focus on problems similar to the one for which
                    its primary jurisdiction is being advanced;

                    5. It has jurisdiction to issue the relief requested;

                    6. Overriding all other factors, the regulatory
                    system will work better if the administrative agency
                    hears the matter rather than the courts.

Bean, 855 A.2d at 152-53. Nevertheless, the doctrine of primary jurisdiction must
be used sparingly and under the appropriate circumstances. Erie Ins.

             Here, primary jurisdiction over approval of the affiliated interest
agreements, which are assignment agreements between Artesian PA and its parent
affiliate, Artesian Resources, lies with the PUC. Indeed, by statute, affiliated interest
agreements require PUC approval in order to be valid or effective. 66 Pa. C.S.
§2102. Clearly, decisions regarding approval of affiliated interest agreements
require special expertise that resides within the PUC. Id. Further, the issue of
whether the affiliated interest agreements should be approved is fact specific and

                                           18
requires extensive testimony to resolve.         Indeed, ongoing litigation as to the
propriety of the affiliated interest agreements is currently proceeding before the
PUC.

             To that end, contrary to the Township’s arguments, in its December 7,
2017 opinion and order, the PUC did not reject Artesian PA’s application for
approval of its affiliated interest agreements, which would assign the 2001 and 2002
Easements from Artesian Resources to Artesian PA. Rather, the PUC “referred
[Artesian PA’s application] to the Bureau of Technical Utility Services,
Water/Wastewater Division, for continued review, consideration and preparation of
an [o]rder disposing of the merits of the [a]pplication under the legal standards of
Chapter 21 of the [Public Utility] Code, [66 Pa. C.S. §§2101-2107] and Section
1102(a)(3) of the [Public Utility] Code, 66 Pa. C.S. [§1102(a)(3),] consistent with
this [o]pinion and [o]rder.” R.R. at 746a. It is apparent that Artesian PA’s
application for approval of its affiliated interest agreements is still pending before
the PUC. See Appellees’ Br., App. A (Prehearing Mem. of New Garden Township,
Pennsylvania, filed with the PUC, 4/13/18, at PUC Dkt. Nos. G-2016-2544455 &
A-2017-2639994).

             Further, the PUC has jurisdiction to grant the requested relief, i.e.,
approval of the affiliated interest agreements. 66 Pa. C.S. §2102. Clearly, the
regulatory system will function more effectively if the PUC, rather than the courts,
hears this matter as required by statute.

                                            19
             In short, a decision as to whether to approve the affiliated interest
agreements falls expressly within the PUC’s jurisdiction and invites the PUC’s
special competency. Thus, we question if the trial court should defer to the PUC on
the issue of whether the affiliated interest agreements should be approved, thereby
resulting in a CPC. As a result, we vacate and remand to the trial court to consider
in the first instance whether to invoke the doctrine of primary jurisdiction. If it
decides to do so, it should not resolve the remaining issues raised by the parties at
this time. Instead, the trial court, with notice to the PUC, should stay the current
proceeding while it awaits the PUC’s decision on Artesian PA’s application for
approval of its affiliated interest agreements. See 36 STANDARD PENNSYLVANIA
PRACTICE 2d §166:384 (2013) (when invoking the doctrine of primary jurisdiction
and referring a particular issue to an agency, “[t]he court will stay the action pending
before it, particularly when an issue is already before the agency.”). After the PUC
acts, the trial court may reinstate its prior orders or take whatever action it deems
appropriate under the circumstances.

                                        ROBERT SIMPSON, Judge

                                          20
        IN THE COMMONWEALTH COURT OF PENNSYLVANIA

New Garden Township,                     :
                          Appellant      :
                                         :
             v.                          :   261 C.D. 2018
                                         :
Artesian Resources Corporation, Inc.,    :
Artesian Water Pennsylvania, Inc.,       :
Artesian Water Company, Inc., and        :
Charles L. Wilkenson Broad Run           :
Valley, Inc.                             :

                                      ORDER

             AND NOW, this 14th day of May, 2019, for the reasons stated in the
foregoing opinion, the judgment of the Court of Common Pleas of Chester County
disposing of the declaratory judgment action initiated by New Garden Township is
VACATED, and the matter is REMANDED for proceedings consistent with the
foregoing opinion. Jurisdiction is relinquished.

                                        ROBERT SIMPSON, Judge