Appeal of Atlantic Connections, Ltd.

608 A.2d 861, 135 N.H. 510
CourtSupreme Court of New Hampshire
DecidedMay 5, 1992
DocketNo. 91-042
StatusPublished
Cited by5 cases

This text of 608 A.2d 861 (Appeal of Atlantic Connections, Ltd.) is published on Counsel Stack Legal Research, covering Supreme Court of New Hampshire primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Appeal of Atlantic Connections, Ltd., 608 A.2d 861, 135 N.H. 510 (N.H. 1992).

Opinion

JOHNSON, J.

Atlantic Connections, Ltd. (Atlantic) appeals from a public utilities commission (PUC) order that it cease and desist from intrastate telecommunications resale operations, pay a $5,000 fine, and apply to the PUC for a certificate of service. We affirm.

In 1988, Atlantic commenced business in Portsmouth as a reseller of long-distance telephone services without obtaining a franchise from the PUC pursuant to RSA 374:22 (1984 and Supp. 1991). According to the PUC report, resellers typically own telecommunication switches and lease interexchange facilities from either the local Bell Operating Company or a franchised long-distance carrier, such as AT&T, that owns its own interexchange facilities. Resellers then purchase a long-distance service from an underlying carrier and resell the use of the lines to their own customers. They profit by attaining discounts available to high volume telephone users and then passing on a portion of the savings to small businesses or residential customers who are not otherwise eligible for such discounts.

The record indicates that Atlantic conducted business in a manner typical of long-distance resellers. It owned a telecommunications switch in New England Telephone’s (NET) Portsmouth local exchange area. It leased interexchange facilities from NET for intrastate calls, and from AT&T, Sprint and MCI for interstate calls. When a call entered Atlantic’s switch via the Portsmouth local exchange network, Atlantic would identify the destination of the call and select the leased line that offered the least cost route.

On March 23, 1990, the PUC opened a docket to investigate whether Atlantic was a public utility operating without the commission’s authority. RSA 362:2 (Supp. 1991) defines a “public utility” as

[512]*512“every corporation, company, association, joint stock association, partnership and person, their lessees, trustees or receivers appointed by any court, except municipal corporations and county corporations operating within their corporate limits, owning, operating or managing any plant or equipment or any part of the same for the conveyance of telephone or telegraph messages ... for the public.”

After five days of hearings, the PUC found that Atlantic was a “public utility.”

The PUC issued a report explaining this finding. In the report, the PUC addressed Atlantic’s argument that it was not engaged in the “conveyance of telephone or telegraph messages,” RSA 362:2 (Supp. 1991), because, like a telephone answering service, it did not own interexchange facilities. The PUC rejected this argument:

“Atlantic’s attempt to compare itself to a telephone answering service cannot be accepted. When a telephone answering service intercepts a call for a customer, the call terminates after the answering service accepts the message. The customer then receives the message from the answering service. There is no direct communication between the customer and the calling party, but rather two separate telephone calls.
In contrast to a telephone answering service, Atlantic’s switch does in fact convey the call between its customer and the called party. As described above, the Atlantic switch identifies the location of the called party and transports the call over the least cost route to its ultimate destination. As staff witness Kathryn Bailey testified, when an Atlantic customer uses Atlantic to complete a call, the Atlantic switch performs the actual physical connection that establishes the two-way communication path between the Atlantic customer and the called party. Contrary to Atlantic’s assertion, there is only one telephone call and, in accordance with the statutory definition, Atlantic’s network of its switch and leased lines conveys the telephone message for the benefit of its customers.”

(Footnote omitted.) The PUC also dismissed Atlantic’s argument that the PUC’s regulatory authority was limited to natural monopolies. On appeal to this court, Atlantic maintains that the PUC erred in finding that it was a “public utility” pursuant to RSA 362:2 (Supp. 1991).

[513]*513Normally, in reviewing PUC determinations, we give significant deference to the commission’s factual findings. Under RSA 541:13, “all findings of the commission upon all questions of fact properly before it shall be deemed to be prima facie lawful and reasonable.” See also Appeal of Richards, 134 N.H. 148, 158, 590 A.2d 586, 592, cert. denied, 112 S. Ct. 275 (1991). In this case, however, the PUC’s finding that Atlantic was engaged in the “conveyance of telephone . . . messages,” RSA 362:2 (Supp. 1991), was determinative of its own jurisdiction over the long-distance resale industry. We hold that such jurisdictional rulings are legal ones and subject to ordinary standards of judicial review. See Mississippi Power v. Miss. ex. rel. Moore, 487 U.S. 354, 386-87 (1988) (Brennan, J., dissenting). Accordingly, we will reverse the PUC order if Atlantic demonstrates “by a clear preponderance of the evidence before it, that such order is unjust or unreasonable.” RSA 541:13; see Richards supra.

We hold that the PUC’s finding that Atlantic was engaged in the “conveyance of telephone ... messages,” RSA 362:2 (Supp. 1991), and therefore subject to PUC jurisdiction as a public utility, was neither unjust nor unreasonable. As the previously cited excerpt indicates, the PUC based its determination on expert testimony presented over several days. Atlantic has failed to present sufficient evidence to rebut the PUC’s finding that Atlantic’s “network of its switch and leased lines conveyfed] the telephone message for the benefit of its customers.”

Atlantic also contends that the PUC’s decision is erroneous in light of Appeal of Omni Communications, Inc., 122 N.H. 860, 451 A.2d 1289 (1982), because the PUC refused to limit its jurisdiction to natural monopolies. We believe that this claim, which turns on the interpretation of judicial precedent, involves a question of law. Cf. Roy v. Water Supply Comm’n., 112 N.H. 87, 89, 289 A.2d 650, 652 (1972) (whether the water pollution commission had jurisdiction to deny the city’s application to extend a city sewer line was a “question of law”); 2 F. Cooper, State Administrative Law 667 (1965) (“[I]f the court feels a superior competence in the premises, the question is classified as one of law.”). Thus, the PUC’s interpretation of Omni will be reversed if erroneous. R. Wiebusch, 5 New Hampshire Practice, Civil Practice and Procedure § 2090, at 532 (1984).

In Omni, this court reviewed both the legislative history of the creation of the PUC and the constitutional history of the enactment of part II, article 83 of the New Hampshire Constitution. Omni, supra at 861-63, 451 A.2d at 1290-91. Based on this historical back[514]*514drop, we concluded “that in enacting RSA 362:2 the legislature did not intend to place all companies and businesses somehow related to railroads, telephone, telegraph, light, heat, and power companies under the umbrella of the PUC’s regulatory power.” Id. at 863, 451 A.2d at 1291.

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608 A.2d 861, 135 N.H. 510, Counsel Stack Legal Research, https://law.counselstack.com/opinion/appeal-of-atlantic-connections-ltd-nh-1992.