People v. Federal Power Commission

353 F.2d 16, 61 P.U.R.3d 587
CourtCourt of Appeals for the Ninth Circuit
DecidedNovember 9, 1965
DocketNos. 19647, 19664
StatusPublished
Cited by2 cases

This text of 353 F.2d 16 (People v. Federal Power Commission) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
People v. Federal Power Commission, 353 F.2d 16, 61 P.U.R.3d 587 (9th Cir. 1965).

Opinion

DUNIWAY, Circuit Judge:

This case arises from the grant by the Federal Power Commission of a certificate of public convenience and necessity to certain producers of natural gas, pursuant to section 7(e) of the Natural Gas Act, 15 U.S.C. § 717f(e), which provides in pertinent part:

[A] certificate shall be issued to any qualified applicant therefor * * if it is found that * * * the proposed * * * sale * * * is or will be required by the present or future public convenience and necessity ; otherwise such application shall be denied. The Commission shall have the power to attach to the issuance of the certificate and to the exercise of the rights granted thereunder such reasonable terms and conditions as the public convenience and necessity may require.

The essential facts, summarily stated, follow. Three gas producers — Humble Oil & Ref. Co., Shell Oil Co., and Superior Oil Co-. — brought gas wells into production in á formerly undeveloped portion of the “Four Corners” producing area, a region encompassing contiguous portions of northeast Arizona, northwest New Mexico, southwest Colorado, and' southeast Utah. They applied for permanent certificates of public convenience and necessity under section 7(e), which would allow them to sell the gas in interstate commerce at their contract rate of 17.7 cents per thousand cubic feet (Mcf.); [18]*18this price is identical with that approved for a nearby field in the prior separate “Aneth” certification proceeding. (El Paso Natural Gas Co., 1960, 23 F.P.C. 370, aff’d sub nom. Texaco, Inc. v. FPC, 5 Cir., 1961, 290 F.2d 149.)

The Trial Examiner found that the certificate should be issued on condition that the price not exceed 13 cents per Mcf., which he found to be the prevailing price in the San Juan Basin of New Mexico, an older producing area about 75 miles away which had served as the point of reference for the certificated price in Aneth. The Commission reversed in a 3-2 decision, finding that the gas subject to the instant sale was more similar to Aneth gas than to San Juan gas and that the price line to be observed was that of Aneth rather than that of San Juan. The State of California and two California gas distributing companies (Southern California Gas Company and Southern Counties Gas Company of California), intervenors in the original proceeding, now petition this court to review and set aside the Commission’s resulting order which granted the certificate without price condition.

The principal argument seems to be that the Commission erred in granting an unconditioned certificate because the certificated price was established by reference to a prior “isolated and insignificant” sale at a now “discredited” price. Two of the producers, Superior and Humble, assert that this court has no jurisdiction to hear a petition for review by the intervenors because (1) respondents failed to present their objections in their Applications for Rehearing and consequently are barred from asserting them here, and (2) they were not “aggrieved” within the meaning of section 19 of the Act (15 U.S.C. § 717r).

1. JURISDICTION.1

A. Waiver of objection by failure to urge it in application for rehearing.

Superior asserts that “the actual contentions on review” are “charges of abuse of discretion, arbitrary and capricious action and unreasonableness by the Commission in its decision making process” and that the petitioners failed to raise these contentions in its Application for Rehearing, and concludes that they therefore cannot be raised in this petition for review. In support it cites many cases and section 19 of the Natural Gas Act, which provides in pertinent part that:

“[§ 19(a)] Any person * * * aggrieved by an order issued by the Commission * * * may apply for a rehearing * * *. The application for rehearing shall set forth specifically the ground or grounds upon which such application is based. * * * No proceeding to review any order of the Commission shall be brought by any person unless such person shall have made application to the Commission for a rehearing thereon. * * * ”
“[§ 19(b)] Any party * * * aggrieved * * * may obtain a review of such order in the circuit court of appeals of the United States * * *. No objection to the order of the Commission shall be considered by the court unless such objection shall have been urged before the Commission in the application for rehearing unless there is reasonable ground for failure so to ¿j0 * *

The argument sacrifices substance to form, and to a form created by respondents rather than by the statute. The errors asserted here were urged in the application for rehearing. The Commission was not misled; its order denying rehearing is responsive to the errors petitioners assert. Hence the purpose of the rule is satisfied. Cf. City of Pittsburgh v. FPC, 1956, 99 U.S.App.D.C. 113. 237 F.2d 741. Respondents term those allegations of error “charges of abuse of [19]*19discretion, arbitrary and capricious action and unreasonableness” and then claim that because petitioners did not, by proper phrasing, anticipate this magical conversion they are raising new objections which, under section 19, are inadmissible. This is a bootstrap argument supported neither by analysis of the actual language in the applications for rehearing nor by the facts or holdings of decisional law.2

B. Are petitioners “aggrieved” under section 19?

Superior makes a de minimis argument here, claiming that the sale in question is so small compared with the total volume sold to either California consumers or Southern Counties’ and Southern California’s customers that neither sustained the “present immediate legal economic injury” which it claims is neccessary to constitute “aggrievement.” A subsidiary argument is that the level of possible future sales cannot be considered- — -indeed, respondent asserts that “the amount of gas involved * * * is small and will have no present effect and probably no future effect on * * consumers of gas in California.” It concludes that, even assuming an abuse of discretion by the Commission, petitioners here are not sufficiently aggrieved to have standing to object.

This contention is utterly without merit. To the extent that it raises a de minimis argument, the facts of the decided cases are squarely against it. E. g., Lynchburg Gas Co. v. FPC, 1964, 119 U.S.App.D.C. 23, 336 F.2d 942; Public Serv. Comm’n v. FPC, 3 Cir., 1958, 257 F.2d 717, aff’d on other grounds sub nom. Atlantic Ref. Co. v. Public Serv. Comm’n, 1959, 360 U.S. 378, 79 S.Ct. 1246, 3 L.Ed.2d 1312; City of Pittsburgh v. FPC, 1956, 99 U.S.App.D.C. 113, 237 F.2d 741; cf. FCC v. Sanders Bros. Radio Station, 1940, 309 U.S. 470, 60 S.Ct. 693, 84 L.Ed. 869; Associated Indus. v.

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353 F.2d 16, 61 P.U.R.3d 587, Counsel Stack Legal Research, https://law.counselstack.com/opinion/people-v-federal-power-commission-ca9-1965.