Central Louisiana Electric Co. v. Louisiana Public Service Commission

205 So. 2d 389, 251 La. 532

• Court: Supreme Court of Louisiana
• Decided: December 21, 1967
• Docket: 48731
• Status: Published

Opinions

HAMITER, Justice.

The instant litigation commenced when the Central Louisiana Electric Company, Inc. (Central), an investor-owned electric public utility, filed a complaint before the Louisiana Public Service Commission (Commission) charging that the Beauregard Electric Cooperative, Inc. (Beaurcgard) had violated the provisions of LRS 45:123 by affording service to the Wood Preserving Division of International Paper Company (allegedly a customer of Central), without first obtaining a certificate of public convenience and necessity from the Commission. Beauregard is a nonprofit cooperative which was organized, and now exists, pursuant to the provisions of LRS 12:301-329 (originally Act 266 of 1940).

Beauregard excepted to the jurisdiction of the Commission, urging that LRS 45:123 is inapplicable since it (Beauregard) is not an “electric public utility” within the contemplation of that statute; and also because LRS 12:326 particularly exempts cooperatives transacting business in this state “in all respects from the jurisdiction and control of the Public Service Commission of this state.” However, the Commission entertained jurisdiction of the matter. And, following a hearing on the merits, it dismissed Central’s complaint, holding that Beauregard had not violated LRS 45:123. (Italics ours.)

. Thereupon, Central appealed to, or brought this suit in, the district court of East Baton Rouge Parish. Beauregard intervened, reurging its exception to the Commission’s jurisdiction.

The district court, relying on our decision in Louisiana Power and Light Company v. Louisiana Public Service Commission et al., 250 La. 596, 197 So.2d 638, maintained the exception to the Commission’s jurisdiction and dismissed the suit. (That court also considered the merits of the cause and approved the factual conclusion of the Commission that Beauregard had not violated the provisions of LRS 45:123. However, because of our holding on the jurisdictional issue announced hereinafter, we shall not pass upon the cause’s merits.)

On this appeal by Central from the district court’s judgment it asks that we reconsider and overrule our decision in the Louisiana Power and Light Company case, supra, wherein we held (among other things) that the provisions of LRS 45:123, which require an electric public utility to obtain a certificate of public convenience and necessity from the Commission before serving customers already receiving service from another electric public, utility, do not apply to electric cooperatives. But our further consideration of that case convinces us that the decision therein was correct and is amply supported by the reasons set out in the opinion. In fact, those reasons are well articulated and documented; and we reaffirm them.

Central also urges here that, even without consideration of the provisions of LRS 45 :123, the plenary authority over all “public utilities”, and “electric public utilities” in particular, granted to the Commission by the first paragraph of Article VI, Section 4 of the Louisiana Constitution of 1921, gives-that body jurisdiction over electric cooperatives; and that, therefore, the Commission has authority to adjudicate customer disputes such as the one involved in the instant case. Cited and relied on are City of Monroe v. Louisiana Public Service Commission, 233 La. 478, 97 So.2d 56 and Greater Livingston Water Company v. Louisiana Public Service Commission, 246 La. 273, 164 So.2d 325 (these we shall discuss hereinafter).

Article VI, Section 4 of the Constitution pertinently provides: “The Commission shall have and exercise all necessary power and authority to supervise, govern, regulate and control all common carrier railroads, street railroads, interurban railroads, steamboats and other water craft, sleeping car, express, telephone, telegraph, gas, electric light, heat and power, water works, common carrier pipe lines, canals, (except irrigation canals) and other public utilities in the State of Louisiana, and to fix reasonable and just single and joint line rates, fares, tolls or charges for the commodities furnished, or services rendered by such common carriers or public utilities, except as herein otherwise provided.

“The power, authority, and duties of the Commission shall affect and include all matters and things connected with, concerning, and growing out of the service to be given or rendered by the common carriers and public utilities hereby, or which may hereafter be made subject to supervision, regulation and control by the Commission, The right of the Legislature to place other public utilities under the control of and confer other powers upon the Louisiana Public Service Commission respecting common carriers and public utilities is hereby declared to be unlimited by any provision of this Constitution.” (Italics ours.)

We do not agree with the contention of Central that the phrase “other public utilities” in the first paragraph of the above quoted section has the effect of placing all public utilities, of whatever nature and character, under the jurisdiction of the Commission. Such an interpretation would render that phrase (in the first paragraph) in direct conflict with, and make nugatory, the above underscored provisions of the second paragraph which give to the Legislature the “unlimited” right to place “other public utilities” under the control of,- and confer other powers respecting such utilities upon, the Commission. It likewise would render meaningless that portion of the second paragraph which sets out the power and authority of the Commission over public utilities “which may hereafter be made subject to supervision, regulation and control by the Commission.”

Moreover, that interpretation would have the same effect with regard to the provisions of Sections 5 and 6 of Article VI. The former section provides for the effective date of rate making orders of the Commission with respect to public utilities “named herein, or hereafter placed under the control of said Commission.” The latter section sets forth the penalty for violation of the Commission’s rate fixing orders by any “public utility now, or which may hereafter be placed, under the control of the Commission.” (Italics ours.)

All of the mentioned constitutional provisions when read together clearly show an intention to limit the Commission’s constitutional powers to the public utilities specifically named therein and to accord to the Legislature the right to determine which other such utilities should be placed under the authority of the Commission as future circumstances dictate. To hold otherwise would do violence to the cardinal rule of constitutional and statutory construction that such enactments should be construed, where possible, so as to give force and effect to each provision and to render none nugatory. Decklar v. Frankenberger, 30 La.Ann. 410; Meyers v. Flournoy, 209 La. 812, 25 So.2d 601; 66 American Jurisprudence 2d 242, verbo “Constitutional Law, Sections 66-67; and 16 C.J.S. verbo Constitutional Law §§ 22-23, p. 91. (Italics ours.)

We think that this court in Talbot v. Louisiana Highway Commission et al., 159 La. 909, 106 So. 377 (and its companion case, Louisiana Public Service Commission v. Louisiana Highway Commission et al., 159 La. 932, 106 So. 385) correctly interpreted the meaning of “other utilities” as used in the first paragraph of the above quoted constitutional provisions when the identical argument made herein was unsuccessfully urged. There it was contended that a toll bridge was a public utility; that its building and operation fell under the jurisdiction of the Public Service Commission by virtue of the “other utilities” provision in the first paragraph of Article VI, Section 4; and that, consequently, the Public Service Commission alone was authorized to' grant the franchise to build the bridge and to fix the tolls to be charged for its use. In. rejecting that contention we said: “The provisions of the Constitution defining the functions and authority of the public service commission, sections 4 to 7, inclusive, of article 6, do not, in terms, give the commission authority to supervise, regulate or control any and every concern serving a public want and called a public utility. It is true that section 4, after declaring that the commission shall have authority to supervise,, govern, regulate and control all common carrier railroads, street railroads, interurban railroads, steamboats and other water craft, sleeping car, express, telephone, gas, electric light, heat and power, waterworks, common carrier pipe lines and canals (except irrigation canals), says: 1and other public utilities in the state of Louisiana/ But the language quoted means such other public utilities as the Legislature may place under the control of the public service commission, and such local public utilities as the electors of any city, town or parish may, a majority vote, surrender to the control of the public service commission. That interpretation is expressed in the second paragraph of section 4, and in Sections 5, 6 and 7 of the same article. * * *

“ * * *

“The idea was that there might be other public utilities — other than those specified in section 4 — that would not come under the control of the public service commission, without an act of the Legislature making it so. It was so said in Standard Oil Co. of Louisiana v. Louisiana Public Service Commission, 154 La. 557, 97 So. 859.” (Italics ours.)

Very shortly after our decision in that case the Legislature, by Act 224 of 1926, placed toll bridges (as public utilities) under the authority of the Public Service Commission ; but it provided that the act should not apply until such bridge was completed and placed in actual operation. Whereupon, the Commission issued orders dealing with the building of the proposed bridge and with rate fixing therefor. And in a suit by the New Orleans Pontchartrain Bridge Company against the Commission to enjoin such action the latter contended that, once the utility had been placed under the authority of the Commission, its jurisdiction vested immediately by virtue of the constitutional provisions (Article VI, Section 4) and that the Legislature was without authority to delay its taking action. This court answered the argument as follows: “The answer is to be found in the last clause of the paragraph and section referred to, and it is this: The right of the Legislature to place'other public utilities than those specially enumerated under the control of the Public Service Commission and to confer on that commission other powers is unlimited by any other provisions of the Constitution.

“If, therefore, the Legislature has the power to declare toll bridges public utilities and to place them under the control of the Public Service Commission, and this power is unlimited, which is conceded, then it logically follows that the Legislature has the power and discretion to declare when such bridges are to become public utilities and to fix the time at which such bridges shall be subject to the control of the Public Service Commission.” New Orleans Pontchartrain Bridge Company v. Louisiana Public Service Commission et al., 162 La. 874, 111 So. 265.

The correctness of our above expressed construction of Article VI, Section 4, we think, is further fortified by the decision in Louisiana Power and Light Company v. Louisiana Public Service' Commission, supra. Therein the primary issue was whether the Commission had jurisdiction to enforce the provisions of LRS 45 :123 against an investor-owned electric public utility at the instance, and for the benefit of, an electric cooperative. In holding that we would not permit the exercise of such authority against an admittedly and constitutionally regulated electric utility for the benefit of an electric cooperative we said: “Nor can the Commission’s order be sustained on the theory that, since Section 4 of Article 6 of the Constitution vests plenary power over all public utilities in the Commission, its action in this case is well within its regulatory jurisdiction. * ■* * For our part, we are not disposed to conclude that the Commission is entitled to exercise the constitutional power vested in it over electric public utilities by settling customer disputes with unregulated electric cooperatives when it may .not regulate the rates the latter may charge for similar service' and when, were-the situation reversed, it would be powerless to order the cooperative to comply. * * ” Implicit, in that language'is the conclusion that the constitution does not. grant plenary authority over aZZ-public utilities. Because if it does the Commission would not' be “powerless to order the cooperative, to comply” in the reverse situation (that which exists here). . - ■

: Nor do we think that the cases cited by Central support its contention that only those public utilities specifically exempt by the constitution 'from Commission regula-' tion are not under its jurisdiction.

City of Monroe v. Louisiana Public Service Commission, supra (the first cited case), involved a rate fixing matter in which there was no question but that the gas corporation concerned was admittedly a regulated public utility. The only issue was between the' City of Monroe and the Public Service Commission'as to which-of these bodies was the proper regulatory authority. The court; merely held that inasmuch as the city had. the right to fix such rates within its limits (when the Commission was given constitutional status and authority) the utility fell within the provisions of Article VI, Section ’ 7 of the Constitution which reserved to municipalities so situated the right to continue to fix rates.

Greater Livingston Water Company v. Louisiana Public Service Commission, supra (the second cited case), did not deal with a consideration of what was meant by “other public utilities” in the first paragraph of Article VI, Section 4. The contention made by the water company there, in attempting to avoid rate fixing by the Commission, was that it was “an instrumentality of a political subdivision of the state” — that is, it was owned by the Parish of Livingston, which parish was authorized to fix its rates — and that,, therefore, it was exempt by the provisions óf Article VI, Section 7. The court found that the company was not owned by the parish (it was privately owned), and held that the parish did not have authority to fix its rates. Therefore, it was not exempt from the operation of Article VI, Section 4 by Section 7 thereof.

The court, incidentally, in the Greater Livingston Water Company case, supra, did_ not conclude that because the company involved was a water utility (and a sort of public utility) that it necessarily fell within the jurisdiction of the Commission. It con- ■ sidered the nature and character of the corporation before concluding that it was within the intendment of Article VI, Section 4. In this connection the court said: “Whatever else the framers of the constitution may have intended, we do not hesitate to conclude that they did not intend that a utility such as that under consideration could be free from the control of either the town, city or parish governments or the Public Service Commission, and hence subject to no control whatsoever. * * *”

In showing that the corporation did fall within the provisions of the constitution the court noted the following characteristics of the company which clearly are not applicable to cooperatives: “Where a monopoly' exists, the regulation by the Public Service Commission, as a state agency, of private utility corporations operated for profit has been considered necessary, as it is, for the protection of their customers. * * *

“For a utility’s customers to be devoid of the protection afforded by the regulatory power of the Public Service Commission and to have no recourse through the ballot against the member-directors who are imposing the rates they must pay, would give them no protection against arbitrary and unreasonable exploitation; there would be no assurance of adequate service at reasonable rates. In this case the company has an exclusive franchise; the member-directors of the company are not elected by the people; they cannot be removed from office by the people, or the parish police jury; they appoint their own successors and are, therefore, immune from any control by the people. Therefore, if they are permitted to avoid regulation by the Commission, their rate-making power would be without any restraint. This is not permitted by Article VI of the Constitution.” By its observations the court thus left the door open for future consideration of whether other water utilities of a different character might or might not fall within the contemplation of Article VI, Section 4.

Furthermore, we have concluded that air electric cooperative is not an “electric public utility” within the intendment of the constitutional provision relied on by Central. Electric cooperatives, as we pointed out in Louisiana Power and Light Company v. Louisiana Public Service Commission, supra, were not in existence in this state as such in 1921 (when our Constitution was adopted). We doubt that organizations of the character of cooperatives were even in contemplation then. Too, as indicated by our observations in Greater Livingston Water Company v. Louisiana Public Service Commission, supra, the constitutional provision when enacted was concerned principally with protection of the customers as against the utility (rather than to regulate as between utilities). Such protection is not necessary in a cooperative operation.

Also persuasive as to the correctness of our conclusion that electric cooperatives are .not “electric public utilities” within the intendment of Article VI, Section 4, is the fact that the Legislature has seen fit to particularly exempt them from such control, •and for a long period of time the Commission never attempted to exercise any authority with respect thereto. It was only recently that the Commission entertained any jurisdiction over the cooperatives (then ■only in customer disputes between them and investor-owned utilities), and this apparently as the result of recent Court of Appeal decisions which were rendered ineffective by Louisiana Power and Light Company v. Louisiana Public Service Commission, supra. (See Pointe Coupee Electric Membership Corporation v. Central Louisiana Electric Company, Inc., et al., La.App., 140 So.2d 683; South Louisiana Electric Cooperative Association v. Central Louisiana Electric Company, Inc., et al., La.App., 140 So.2d 687; and South Louisiana Electric Cooperative Association v. Louisiana Power and Light Company, La.App., 161 So.2d 413.)

Therefore, our conclusion is that electric cooperatives, assuming arguendo that they are “public utilities” of some sort and as such might be placed by the Legislature either partially or wholly under the authority of the Commission, are not “electric public utilities” or “other utilities” envisioned by the language and within the intendment of Article VI, Section 4 of the Louisiana Constitution; and that, inasmuch as the Legislature has not exercised its prerogative to give the Commission control of them, the latter is without jurisdiction over their operations.

The briefs of Central and of amicus curiae (filed in behalf of Central’s position) contain cogent arguments and compelling reasons why (assuming that the facts recited in those briefs are correct — they do not all appear in the record) the time has come, in the interest of orderly distribution of electric service throughout the state and to prevent economic waste in the industry, for the electric cooperatives to be regulated, at least in some respects, by the Public Service Commission. However worthy such arguments and reasons might be, they obviously address themselves to the Legislature, the policy-making body of the state, and not to the courts.

For the reasons assigned the judgment of the district court, maintaining the exception to the jurisdiction of the Public Service Commission and dismissing this suit, is affirmed. Central is cast for all costs.