City of Surprise v. acc/lake Pleasant

437 P.3d 865, 246 Ariz. 206
CourtArizona Supreme Court
DecidedMarch 28, 2019
DocketCV-18-0137-SA
StatusPublished
Cited by42 cases

This text of 437 P.3d 865 (City of Surprise v. acc/lake Pleasant) is published on Counsel Stack Legal Research, covering Arizona Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Surprise v. acc/lake Pleasant, 437 P.3d 865, 246 Ariz. 206 (Ark. 2019).

Opinions

VICE CHIEF JUSTICE BRUTINEL, opinion of the Court:

¶1 The Arizona Corporation Commission ("Commission") has broad authority under A.R.S. § 40-285(A) to approve the sale or disposition of a public service corporation's assets. In this special action, we hold that § 40-285(A) does not give the Commission power over a city's exercise of eminent domain. Accordingly, we vacate the portion of the Commission's March 30, 2018 order requiring the public utility to apply for Commission approval of the proposed condemnation.

I. BACKGROUND

¶2 In October 2017, the City of Surprise ("City") entered into a letter of intent with Circle City Water Company, L.L.C. ("Circle City"), documenting the City's intent to condemn substantially all the assets of Circle City, including the right to almost four thousand acre-feet of water per year from the Central Arizona Project ("CAP"). Pursuant to statute, Surprise voters authorized the condemnation and the Surprise City Council approved the filing of a condemnation action. A residential developer contends that Circle City is obliged under an existing contract to allocate its CAP water for a planned development. Upon inquiry by the developer, the City advised that it has no obligation to provide water under the existing contract. The developer then asked the Commission to enter an order preventing the sale of Circle City's CAP allocation to the City.

¶3 The Commission opened an investigation. On March 30, 2018, the Commission ordered Circle City to file an application under § 40-285 and Arizona Administrative Code ("A.A.C.") R14-2-402(D), seeking Commission authorization "to abandon, sell, lease, transfer, or otherwise dispose of its utility." At the time of the order, the Commission was aware that the negotiations between the City and Circle City were intended to result in condemnation, not a sale. Circle City filed the application under protest. Commission staff determined that Circle City did not fully comply with the March 30 order by failing to include a copy of the draft condemnation agreement between Circle City and the City. At the Commission's direction, Circle City provided a copy of the draft agreement under seal. The Commission then required Circle City to confirm in writing whether the City would assume Circle City's water contract with the developer.

¶4 Shortly thereafter, the City filed this special action, alleging the Commission acted without jurisdiction in entering the March 30 order. This Court stayed further administrative proceedings pending resolution of this case.

¶5 We accepted jurisdiction over this special action to clarify the scope of the Commission's authority over eminent domain proceedings pursuant to A.R.S. § 40-285(A). We have jurisdiction pursuant to article 6, section 5(1) of the Arizona Constitution and A.R.S. §§ 12-2001 and 12-2021.

II. DISCUSSION

A. Jurisdiction

¶6 This Court has original jurisdiction to issue "mandamus, injunction and other extraordinary writs to state officers." Ariz. Const. art. 6, § 5 (1); see also A.R.S. §§ 12-2001, -2021. Such jurisdiction is discretionary and is requested through a special action petition. Dobson v. State ex rel. Comm'n on Appellate Court Appointments , 233 Ariz. 119 , 121 ¶ 6, 309 P.3d 1289 , 1291 (2013). Special action jurisdiction is appropriate in cases that involve "purely legal questions of statewide importance" or that require an "immediate and final resolution," id. at 121 ¶¶ 7-8, 309 P.3d at 1291 , and particularly appropriate when a defendant "has proceeded or is threatening to proceed without or in excess of jurisdiction or legal authority," Ariz. R.P. Spec. Act. 3(b). But special action jurisdiction is not appropriate when parties have an "equally plain, speedy, and adequate remedy by appeal." Id. 1(a).

¶7 Here, the scope of Commission authority involves a purely legal question of statutory interpretation: whether the Commission has exceeded its statutory authority. The City cannot presently appeal the Commission's order because it is not a party to the administrative proceedings, and the City has no other means to challenge the Commission's actions. For those reasons, special action review is appropriate. See Ariz. Corp. Comm'n v. State ex rel. Woods , 171 Ariz. 286 , 288, 830 P.2d 807 , 809 (1992) (granting special action review because "this court can best serve the public interest and principles of judicial economy by resolving fundamental legal questions regarding the Commission's constitutional power at this time").

B. Standing

¶8 The Commission asserts that the City lacks standing to bring this action and the City's case is not ripe for decision. This Court is "not constitutionally constrained to decline jurisdiction based on lack of standing" because the Arizona Constitution, unlike the Federal Constitution, contains no "case or controversy" requirement. Sears v. Hull , 192 Ariz. 65 , 71 ¶ 24, 961 P.2d 1013 , 1019 (1998). Whether to deny standing in Arizona is a matter of "prudential or judicial restraint." Dobson , 233 Ariz. at 122 ¶ 9, 309 P.3d at 1292 (quoting Armory Park Neighborhood Ass'n v. Episcopal Cmty. Servs. in Ariz. , 148 Ariz. 1

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Bluebook (online)
437 P.3d 865, 246 Ariz. 206, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-surprise-v-acclake-pleasant-ariz-2019.