Court Opinion

ID: 3810782
Source: CourtListenerOpinion
Date Created: 2016-07-06 07:49:32.184863+00
Date Added: 2024-06-11T12:34:54.617692
License: Public Domain

The Corporation Commission, by its final order after trial, granted Elk City a judgment against Southwestern Light  Power Company for $6,173.92 as refund of overpayment for electric current for pumping city water between 1930 and 1935; and also *Page 541 
fixed a substantially lower rate as the future rate for such current.
Upon this appeal both such conclusions are attacked.
As to the judgment for $6,173.92 the controlling question is whether the Corporation Commission had jurisdiction of the subject matter and jurisdiction to render the particular judgment rendered.
Essential facts are that in 1926 Elk City and Southwestern Light  Power Company entered into a written contract providing that Elk City should use electric current for street lighting and operating its water pumping station, and Southwestern should install and maintain certain apparatus and furnish electric current at stipulated rates. The contract contained a provision which Elk City construed to mean that the rates should be reduced if Southwestern should thereafter grant lower rates to any other city under conditions similar to Elk City and having similar power load or consumption. The term of the contract was ten years, so that it was to expire in 1936.
After electric current had been regularly furnished by Southwestern and paid for by the city for nearly nine years, the city in 1935 filed this action or proceeding before the Corporation Commission.
The city's petition pleaded the written contract, and alleged that in 1930 and 1932 Southwestern had granted lower rates to other named cities for the pumping of city water, and that by reason of the aforementioned contract provision, and by reason of the establishing of more favorable rates for similar service in other such similar cities, Elk City had been overcharged between 1930 and 1935, in the sum of $6,173.92. The city sought a hearing and an order directing Southwestern to refund all sums collected in excess of the rate that should have been applied when the electric current was furnished.
It is clearly apparent from the petition of Elk City with exhibits, the method of trial of the issues, the statements of counsel during trial, and the detailed findings of fact and conclusions of the Corporation Commission, that this was in no sense an ordinary rate case, but was primarily an action or proceeding to compel performance of the written contract, or to recover a sum due for failure to comply with such contract. The contract was treated as a valid and binding contract and the rights of Elk City were determined upon the provisions of the contract. In effect, the judgment of the Corporation Commission construed the contract, determined that Southwestern had not complied with its contract, and in order to comply therewith should pay or refund to Elk City the claimed sum of $6,173.92. This was beyond the jurisdiction of the Corporation Commission. That body is one of limited judicial power. Atchison, T.  S. F. Ry. Co. v. Corporation Commission, 68 Okla. 1, 170 P. 1156; Smith v. Corporation Commission, 101 Okla. 254, 225 P. 708; Chicago, R.I.  P. Ry. Co. v. State, 158 Okla. 57,12 P.2d 494. Assuming the contract to be valid and binding and fully subject to the construction placed thereon by Elk City, then the city had some definite contractual rights as against Southwestern, but whatever rights Elk City had on this contract could only be prosecuted and recovered upon in the courts of general jurisdiction. Okla-Arkansas Telephone Co. v. Southwestern Bell Telephone Co., 143 Okla. 76, 291 P. 3; Central States Power  Light Corp. v. Thompson, 177 Okla. 310,58 P.2d 868; Smith v. Corporation Commission, 101 Okla. 254,225 P. 708; Chicago, R.I.  P. Ry. Co. v. State, 158 Okla. 57,12 P.2d 494, and Atchison, T.  S. F. Ry. Co. v. Corporation Commission, 68 Okla. 1, 170 P. 1156.
While the Corporation Commission has complete authority and jurisdiction in rate-making cases to fix utility rates, and in proper cases may order refund of excessive rate collections over the legal rate, there is no authority to construe *Page 542 
contractual rights and to decree a right to a reduction by contract of the parties, or on account of their agreements, and thereupon to render judgment for a refund calculated on such a reduction. No constitutional or statutory provision or former decision to the contrary is cited.
It seems clear that a city in operating a waterworks system is acting in a proprietary capacity, and that in general its contracts for electric current used therein, and its contractual rights, are subject to the same rules applicable to contracts of other persons or corporations. See Fretz v. City of Edmond, 66 Okla. 262, 168 P. 800; Moomaw v. Sions,96 Okla. 202, 220 P. 865, and City of Muskogee v. Turner, 186 Okla. 459,98 P.2d 1095.
As to that portion of the final order of the Corporation Commission fixing a reduced rate as the future rate for electric current for pumping water, there is not sufficient evidence nor such finding of fact as to form and constitute the necessary predicate for a valid rate order.
Here, in effect, the commission found that by virtue of the contract Elk City was entitled to the lower rate existing in the other named city and by comparison fixed such lower figure as the future rate for Elk City. It is now well settled that evidence and detailed findings of fact must precede a valid rate order. See Pioneer T.  T. Co. v. Westhaven, 23 Okla. 226,99 P. 1019; Atchison, T.  S. F. Ry. Co. v. State,23 Okla. 510, 101 P. 262; St. Louis  S. F. Ry. Co. v. Newell,25 Okla. 502, 106 P. 818; Muskogee Gas  Electric Co. v. State,81 Okla. 176, 186 P. 730; Oklahoma Natural Gas Co. v. Corporation Commission, 90 Okla. 84, 216 P. 917; Okmulgee Gas Co. v. Corporation Commission, 95 Okla. 213, 220 P. 28; Tulsa Tribune Co. v. Oklahoma Natural Gas Co., 126 Okla. 280, 261 P. 213.
No effort was made here to prepare the evidence to cover such necessary points, as is made clear by the record, including statements of the attorneys and witnesses. Since no such necessary evidence was presented, nor any such essential findings of fact made, such rate order must be vacated.
Our conclusion is not intended in any manner to preclude or prejudice the right of Elk City to seek a proper hearing and a rate-making order in the usual way; nor to invade or restrict the jurisdiction of the Corporation Commission, upon proper hearing and findings, to properly fix this and any other rate in Elk City. This power to fix rates is not hindered by a contract rate. Any such contract fixing a rate falls when the Corporation Commission exercises its power by making a valid rate order. That has been expressly held. See City of Durant v. Consumers Light  Power Co., 71 Okla. 282, 177 P. 361; Shaffer Oil  Gas Co. v. Creek County Gas Co., 114 Okla. 258,246 P. 630; Minneapolis, St. Paul  St. S. M. Ry. Co. v. Menasha Wood Ware Co., 159 Wis. 130, 150 N.W. 411, L.R.A. 1915F, 732.
The judgment and order appealed from is reversed.
BAYLESS, C. J., and OSBORN, GIBSON, DAVISON, and NEFF, JJ., concur. CORN, V. C. J., and RILEY and HURST, JJ., dissent.