East Ohio Gas Co. v. Public Utilities Commission

530 N.E.2d 875, 39 Ohio St. 3d 295, 1988 Ohio LEXIS 362
CourtOhio Supreme Court
DecidedNovember 9, 1988
DocketNo. 87-1125
StatusPublished
Cited by51 cases

This text of 530 N.E.2d 875 (East Ohio Gas Co. v. Public Utilities Commission) is published on Counsel Stack Legal Research, covering Ohio Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
East Ohio Gas Co. v. Public Utilities Commission, 530 N.E.2d 875, 39 Ohio St. 3d 295, 1988 Ohio LEXIS 362 (Ohio 1988).

Opinion

Wright, J.

East Ohio requests this court to reverse the commission’s order approving the Revised Stipulation and Recommendation. East Ohio argues: (1) that MB and Northeast are affiliated within the meaning of R.C. 4905.03(A)(6), so that the commission cannot relieve MB from regulation as a public utility and natural gas company; (2) that even if it is not affiliated with Northeast, a producer of natural gas such as MB with an extensive pipeline system must be subject to regulation as a public utility and natural gas company; and (3) that the sale of pipeline and related facilities by MB to Northeast and the withdrawal of other property by MB from public utility service require compliance with certain statutory procedures that were not followed. The commission argues that East Ohio lacks standing to bring this appeal because, as to East Ohio, the commission’s decision is not a final appealable order. We agree that MB and Northeast are affiliated within the meaning of R.C. 4905.03(A)(6), reverse the order, and remand the case to the commission.

I

Standing

The commission argues that this court only has jurisdiction to hear appeals of final orders of the commission, R.C. 4903.132; that the existence of a final order depends on a substantial right being affected, R.C. 2505.023; that no substantial right of East Ohio [298]*298has been affected; and that, therefore, as to East Ohio, there is no final appealable order. Ohio Contract Carriers Assn., Inc. v. Pub. Util. Comm. (1942), 140 Ohio St. 160, 23 O.O. 369, 42 N.E. 2d 758. To state there is no final order as to East Ohio is merely to state that East Ohio has no substantial right affected by the opinion and order of the commission. This is a question different from whether there is a final order with respect to the entire case. Clearly, the order, which prescribes and limits the conditions under which MB and its affiliated companies may sell natural gas, affects a substantial right of MB. The question is whether it also affects a substantial right of East Ohio.

The commission argues that the record contains no evidence of any substantial interest of East Ohio. We disagree. In Ohio Contract Carriers Assn., supra, we characterized the interest necessary to create a “substantial right” under G.C. 544, the predecessor of R.C. 2505.02, as a “ ‘present interest’ ” and an “ ‘immediate and pecuniary’ ” interest. Id. at 161, 23 O.O. at 369, 42 N.E. 2d at 759. See, also, In re Guardianship of Love (1969), 19 Ohio St. 2d 111, 113, 48 O.O. 2d 107, 109, 249 N.E. 2d 794, 795. In its memorandum in support of its motion to intervene in this case, East Ohio, referring to the 825 case in which MB first sought exemption from regulation, alleged:

“* * * that if MBO [MB] could compete for gas customers without regulation and could so draw customers away from East Ohio unfairly, East Ohio and its remaining customers would be adversely affected. * * * Like it had in Case No. 85-825-GA-ARJ, East Ohio has an interest in this case to assure that MBO’s supply and distribution are regulated so that MBO and East Ohio may compete fairly.”

The commission’s attorney examiner granted the motion to intervene, stating:

“* * * East Ohio alleged that it has the same interest in the instant case [as in the 825 case] to assure that MBO’s supply and distribution activities are regulated so that MBO and East Ohio may compete fairly.
“3) The motion of East Ohio to intervene in the instant proceeding should be granted.”

Moreover, in its opinion and order in this case, the commission stated:

“The Commission is mindful of the circumstances in which East Ohio finds itself at the present time. East Ohio argues it has lost a part of its industrial load to unregulated gas companies and that these companies have an unfair advantage over’ East Ohio because they are not regulated by the Commission. Recognizing this problem, the Commission issued its 1076 Order setting limits on the activities gas producers could engage in without being considered a natural gas company subject to our jurisdiction. * * *”

Thus, East Ohio’s interest is identified in the record as present, immediate, and pecuniary. Ohio Contract Carriers Assn., supra.

In Ohio Power Co. v. Attica (1970), 23 Ohio St. 2d 37, 52 O.O. 2d 90, 261 N.E. 2d 123, we held that Ohio Power, as the supplier of power to a village under an existing franchise, had standing to attack ordinances granting a new franchise to a rural electric cooperative to supply power in a part of the village, stating that Ohio Power had a “vital interest” in the authority of the village to grant the franchise. Id. at 38, 52 O.O. 2d at 91, 261 N.E. 2d at 125. Those factors closely parallel the facts in this case. Here, East Ohio has a vital interest, i.e., a present, immediate, and pecuniary interest, in the authority of the commission to exempt MB from regulation. In both cases, a [299]*299direct effect on the appellant’s sales in a given area is involved.

We recognize that standing to intervene in proceedings before the commission does not necessarily confer standing to appeal to this court. Ohio Contract Carriers Assn., supra. However, in this case, the interest identified in the record and relied on by the commission does confer standing to appeal to this court.

Accordingly, we hold that the order of the commission affects a substantial right under R.C. 2505.02, and that it is a final appealable order of the commission as to East Ohio under R.C. 4903.13.

II

Affiliation

R.C. 4905.03(A)(6) states in part:

“* * * The commission may, upon application made to it, relieve any producer of natural gas, defined in this section as a gas company or a natural gas company, of compliance with the obligations imposed by * * * [public utility law], so long as such producer is not affiliated with or under the control of a gas company or a natural gas company engaged in the transportation or distribution of natural gas, or so long as such producer does not engage in the distribution of natural gas to consumers.” (Emphasis added.)

East Ohio argues that MB is “affiliated with” Northeast, a natural gas company. It is undisputed that JR, a company owned by the family interest that owns MB, owns 9.7 percent of the stock of Northeast and that two members of the board of directors of MB and EB are also directors of Northeast. On this issue the commission concluded, based on its finding in a previous case, case No. 85-1974-GA-AEC, which involved Northeast, that “affiliated with” means the ability to direct the policy of, and thus to control, another. Specifically, it found that JR’s stock ownership and the common directors did not give MB the ability to control Northeast.

East Ohio argues that to define “affiliated with” in terms of control is to make that phrase synonymous with “control,” as expressly used in the statute, a violation of a canon of statutory construction. We start from the premise that construction of the phrase is a legal issue ultimately for this court to decide, and not a factual question which we subject to less intensive examination. Consumers’ Counsel v. Pub. Util. Comm. (1979), 58 Ohio St. 2d 108, 110, 12 O.O. 3d 115, 116, 388 N.E. 2d 1370, 1373.

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Cite This Page — Counsel Stack

Bluebook (online)
530 N.E.2d 875, 39 Ohio St. 3d 295, 1988 Ohio LEXIS 362, Counsel Stack Legal Research, https://law.counselstack.com/opinion/east-ohio-gas-co-v-public-utilities-commission-ohio-1988.