Gulf States Utilities Co. v. Dixie Electric Membership Corp.

185 So. 2d 313, 1966 La. App. LEXIS 5408
CourtLouisiana Court of Appeal
DecidedApril 4, 1966
DocketNo. 6369
StatusPublished
Cited by7 cases

This text of 185 So. 2d 313 (Gulf States Utilities Co. v. Dixie Electric Membership Corp.) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gulf States Utilities Co. v. Dixie Electric Membership Corp., 185 So. 2d 313, 1966 La. App. LEXIS 5408 (La. Ct. App. 1966).

Opinion

ELLIS, Judge.

These proceedings were initially instituted in the Nineteenth Judicial District Court for the Parish of East Baton Rouge. Gulf States Utilities Company, hereinafter called Gulf States, sued Dixie Electric Membership Corporation, hereinafter called Dixie,, praying for a. temporary restraining order and preliminary injunction against Dixie enjoining it from “further construction of an electric distribution line * * * in. Baker Oaks Subdivision, City of Baker,. Parish of East Baton Rouge * * * ”.

The petition alleges that both parties are-in the business of selling electric power but. that only Gulf States holds a nonexclusive-franchise granted by the City of Baker to-sell such power within the corporate limits of Baker.

The petition further alleges that Dixie-is in the process of constructing electric distribution facilities within the corporate limits of Baker, particularly designed to-serve the needs of Baker Oaks Subdivision..

The injunction is sought on the dual' ground that Dixie has no franchise to operate within the corporate limits of Baker and consequently has no privilege to do so and on the ground that the Dixie poles and' transmission lines are so close to the existing poles and transmission lines of Gulf States that they create an extreme hazard for workmen, linemen and the general public.

Dixie filed a motion to dissolve the temporary restraining order and an exception to the jurisdiction ratione materiae of the District Court. The District Court maintained the exception to its jurisdiction and dismissed plaintiff’s suit.

An application for writs to this court was denied and thereafter plaintiff perfected a devolutive appeal. In reply to the de-volutive appeal Dixie filed a motion to dismiss the appeal on the ground that this court, in denying the application for writs,, had already ruled that the District Court did not have jurisdiction of this case. This [315]*315court, 172 So.2d 116, granted the motion to dismiss based on the established jurisprudence that the Louisiana Public Service Commission has exclusive jurisdiction over the right of a utility company to serve a customer and on the basis that this court, in refusing the writs, had already ruled on the jurisdictional question.

Thereafter, Gulf States obtained certio-rari from the Louisiana Supreme Court.

That court, 173 So.2d 543, 179 So.2d 637, reversed the ruling of the First Circuit Court of Appeal on the dual ground that Borden et al. v. Louisiana State Board of Education et al., 168 La. 1005, 123 So. 655, clearly establishes that the refusal of the Court of Appeal to grant supervisory writs does not deprive a party of his right to an appeal; and on the ground that, since the jurisdictional question “relates to the basic issue going to the merits of the appeal”, the question of jurisdiction should have been taken up on the merits of the appeal and not decided on a motion to dismiss.

The Louisiana Supreme Court, as we read the opinion, did not actually pass on the juridictional issue but remanded the case to this court for that purpose.

Contrary to our previous holding in this case we believe that the trial court was in error in dismissing plaintiff’s suit for lack of jurisdiction.

Insofar as Gulf States has alleged the creation of a hazard by the close proximity of the two power lines we believe that the District Court did have jurisdiction. However, Gulf States is not primarily concerned with the placement of the Dixie lines, but with their very existence within the corporate limits of Baker. Therefore, the focal point of the conflict here centers on the defendant’s contention that this proceeding involved the privilege, or lack thereof, of a public utility company to furnish electric energy to potential customers and is, therefore, a matter within the exclusive jurisdiction of the Louisiana Public Service Commission.

Plaintiff relies on the case of Town of Coushatta v. Valley Electric Membership Corporation, La.App., 139 So.2d 822. In that case the Town of Coushatta, various officers and taxpayers of the town, and Central Louisiana Electric Company obtained a court injunction against the defendant halting construction of a transmission line and extension of its electric service within the corporate limits of the town. The reported facts in that case reveal that Central Louisiana Electric Company had a non-exclusive franchise granted by the Town of Coushatta to operate within its boundaries. Valley Electric had no such franchise. The Second Circuit in that case said at page 827:

“ * * * the franchise now held and. exercised by the plaintiff, Central Louisiana Electric Company, Inc., is one of a nonexclusive type or character. Such franchises standing alone do not include the right to be free of competition, and such a grant does not prevent the granting of similar franchises to others. Nevertheless, such a franchise may be properly characterized as exclusive against one who carried on a competing operation without a franchise or without due authorization. The holder of a nonexclusive franchise, however, has the legal right to be free from the competition of one not having a valid franchise. This rule is recognized and applied in respect of a franchise to function as or a franchise granted to a public utility. 37 C.J.S. Franchises § 22, pp. 172-173.
“An injunction is a proper remedy where the franchise of a corporation or its rights thereunder are being invaded. The right to an injunction extends not only to the actual, but also to threatened, interference with the rights conferred by the franchise. One whose franchise is not exclusive is not entitled to enjoin legitimate competition. However, a franchise, even though nonexclusive, is a valuable property right (23 Am.Jur., pp. 717-745, ‘Franchises,’ §§ 4-39) and the owner of a franchise, although not exclusive, is en[316]*316titled to relief by way of an injunction against a threatened or actual injury to his property rights through illegal non-franchise competition on the theory that the rights granted, although not exclusive, are actually so as to all others not having a similar franchise.”

That case appears to be clearly at point with the instant case and we are unable to distinguish the two. Learned counsel for the defendant has attempted to distinguish the Coushatta case on the basis that the City of Baker is not a party to the instant suit. Our reading of the Coushatta opinion and, in particular, the above quoted portion, convinces us that the basis of the decision is grounded in the privilege or property right created by the franchise, which privilege, though not exclusive, is nonetheless entitled to judicial protection against nonfranchised competition. Consequently, the Town of Baker is not a necessary party to a suit by the owner of a franchise to protect his property right therein.

Whether the Town of Baker actually consented to Dixie’s new lines, as defendant argues, is a matter addressing itself to the evidence which is not yet before this court. It would appear, however, that the conclusive evidence of such consent, if the consent falls short of an actual nonexclusive franchise, would not serve to divest Gulf States of its exclusive franchise as to all nonfranchised competition.

Counsel for Dixie points out that the jurisdictional question was not discussed by the court in the Coushatta opinion. While this is true, we cannot now hold that the court in that case was without jurisdiction.

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Bluebook (online)
185 So. 2d 313, 1966 La. App. LEXIS 5408, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gulf-states-utilities-co-v-dixie-electric-membership-corp-lactapp-1966.