Shark v. Northern States Power Co.

477 N.W.2d 251, 1991 N.D. LEXIS 204, 1991 WL 237275
CourtNorth Dakota Supreme Court
DecidedNovember 18, 1991
DocketCiv. 910104
StatusPublished
Cited by5 cases

This text of 477 N.W.2d 251 (Shark v. Northern States Power Co.) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Shark v. Northern States Power Co., 477 N.W.2d 251, 1991 N.D. LEXIS 204, 1991 WL 237275 (N.D. 1991).

Opinions

GIERKE, Justice.

Myer Shark appeals from a district court judgment affirming a decision by the North Dakota Public Service Commission [PSC] to allow Northern States Power [NSP] to recover its costs for the construction of a natural gas pipeline by retaining up to $368,640 in credits given to certain customers. We reverse the judgment and remand for proceedings consistent with this opinion.

In 1989 NSP sought to implement a project to bring natural gas from the Willi-ston Basin to its eastern North Dakota service area by building a pipeline interconnect with Williston Basin Interstate Pipeline [WBI]. The interconnect would enhance NSP’s current supply system in the Fargo service area with a second supply of pipeline natural gas and would also provide for future growth. The plans for the project required WBI to reinforce parts of the existing pipeline system from the Willi-ston Basin to Valley City and to construct a new pipeline from Valley City to Mapleton. NSP was responsible for constructing a new pipeline from Mapleton to Fargo, with an estimated cost of approximately $1,834,-000. On October 3, 1989, NSP filed a revision of its existing gas tariff with the PSC pursuant to Section 49-05-05, N.D.C.C.,1 [253]*253seeking additional revenue to recover the cost of constructing the pipeline.

NSP proposed to raise the additional revenue by eliminating the Firm Service Credit Provision of its Purchased Gas Adjustment Clause (transportation and interruptible revenue credits) upon commencement of service from WBI. The transportation and interruptible revenue credits were originally ordered by the PSC in two prior cases. They are a “non-traditional” method of ratemaking ordered by the PSC to deal with NSP’s revenues from transportation of gas for large interruptible customers, 1.e., qualifying customers who purchase gas directly from wellhead producers and transport it to NSP’s town border stations where it is transported through NSP’s distribution system to the customers. The PSC and NSP were unable to ascertain the volumes and margins for gas which inter-ruptible customers purchased, and the PSC directed NSP to credit the rates of NSP’s other customers with two-thirds of the net revenues from this transportation function.

In this case NSP requested that its filing be handled expeditiously so that various contractual as well as federal and state regulatory aspects of the entire project could be completed in 1990. Pursuant to Sectioñ 49-05-06, N.D.C.C.,2 the PSC suspended NSP’s filing on October 24, 1989. On November 30, 1989, NSP amended the filing to limit its recovery to no more than $368,6843 which was calculated by multiplying NSP’s estimated cost for the pipeline of $1,834,000 times a capital cost justification percentage of .201.

On December 5, 1989, PSC issued a notice, setting NSP’s filing for hearing in Bismarck on December 27, 1989, and stating that the PSC believed good cause existed to notice the hearing upon less than 20 days notice. The PSC mailed the notice of hearing to interested parties, including Shark, on December 7, 1989. On December 12, 1989, the PSC moved the hearing to Fargo at the request of Fargo’s gas customers and North Dakota legislators. On December 18, 1989, Shark, an attorney appearing pro se, petitioned to intervene and [254]*254to continue the hearing until “early in 1990.” On December 20, 1989, the PSC granted Shark’s petition to intervene and denied his request for a continuance. According to Shark, he received the PSC’s order granting his petition to intervene on December 26, 1989.

At the December 27 hearing Shark renewed his request for a continuance because of the lack of time to prepare. The hearing examiner noted Shark’s request and informed him that the PSC would address it at a later date. On January 30, 1990 the PSC issued its decision allowing NSP to retain up to $368,640 of transportation and interruptible revenue credits when the pipeline became operational and requiring NSP to file detailed reports identifying the actual final costs of the project.

Shark appealed to the district court, contending, among other things, that he was deprived of due process and a fair hearing because he did not have adequate time to prepare. The district court concluded that the notice of hearing complied with the law and affirmed the PSC’s decision. Shark has appealed.

Appeals from decisions of the PSC are governed by the Administrative Agencies Practice Act, ch. 28-32, N.D.C.C. Northern States Power Co. v. North Dakota Public Service Commission, 452 N.W.2d 340 (N.D.1990). Section 28-32-19, N.D.C.C., requires affirmance of an administrative agency decision unless

“1. The order is not in accordance with the law.
“2. The order is in violation of the constitutional rights of the appellant.
“3. Provisions of this chapter have not been complied with in the proceedings before the agency.
“4. The rules or procedure of the agency have not afforded the appellant a fair hearing.
“5. The findings of fact made by the agency are not supported by a preponderance of the evidence.
“6. The conclusions of law and order of the agency are not supported by its findings of fact.”

Shark contends that he was denied due process and a fair hearing because the time period between the notice of hearing and the hearing was not reasonable in view of the nature, scope, and importance of the hearing. He asserts that that time period did not give him sufficient advance notice of the issues to permit reasonable time for discovery and preparation of his ease. He argues that the PSC abused its discretion in denying his request for a continuance.

Section 49-01-07, N.D.C.C., authorizes the PSC to “make ... rules ... for the orderly regulation of proceedings before it, including forms of notice and the service thereof, which shall conform as nearly as possible to those in use in the courts of this state.” Pursuant to that statute, the PSC has adopted Section 69-02-04-01, N.D.A.C., which provides:

“Notice. In those proceedings in which a hearing is to be held, the commission will, by order or otherwise, assign a time and place for hearing. Notice of the hearing will be posted in the office of the commission, and will be served upon the parties and such other persons that may be entitled to receive notice at least twenty days prior to the date set for the hearing except in cases of emergency.”

Section 49-02-02(5), N.D.C.C., also provides:

“Powers of public service commission with reference to public utilities. The commission shall have power to:
* * * * * *
“5. Hold hearings on good cause being shown therefor or on its own motion, and to provide notice thereof and to shorten the period for which notice shall be given prior to hearing, when good cause exists for such action. Such notice, however, shall be reasonable in view of the nature, scope, and importance of the hearing....”

In Eckre v. Public Service Commission, 247 N.W.2d 656, 664 (N.D.1976), we considered issues about notice and observed:

“The Legislature has thus delegated to the PSC a discretionary power to promul[255]

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Shark v. Northern States Power Co.
477 N.W.2d 251 (North Dakota Supreme Court, 1991)

Cite This Page — Counsel Stack

Bluebook (online)
477 N.W.2d 251, 1991 N.D. LEXIS 204, 1991 WL 237275, Counsel Stack Legal Research, https://law.counselstack.com/opinion/shark-v-northern-states-power-co-nd-1991.