State Ex Rel. Corbin v. Arizona Corp. Commission

848 P.2d 301, 174 Ariz. 216
CourtCourt of Appeals of Arizona
DecidedJune 3, 1992
Docket2 CA-CV 92-0052
StatusPublished
Cited by12 cases

This text of 848 P.2d 301 (State Ex Rel. Corbin v. Arizona Corp. Commission) is published on Counsel Stack Legal Research, covering Court of Appeals of Arizona primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State Ex Rel. Corbin v. Arizona Corp. Commission, 848 P.2d 301, 174 Ariz. 216 (Ark. Ct. App. 1992).

Opinions

OPINION

HOWARD, Judge.

After a public hearing the corporation commission, on March 14, 1990, promulgated A.A.C. R14-2-801 through R14-2-806 in Commission Decision No. 56844 (the “order”). These rules regulate the formation of holding companies by public service corporations, govern the ability of public service corporations to invest in business activities that may pose a risk to the utility’s ratepayers, and regulate transactions between public service corporations and their affiliates. The second paragraph of the “order” stated: “[T]he rules adopted herein shall become effective upon filing with the Office of the Secretary of State pursuant to A.R.S. § 41-1032 or 90 days after the submission of the rules to the Attorney General, whichever is earlier.”

The state and a number of utilities challenged the rule in the superior court on the ground that the above quoted paragraph would allow the rules to become effective even if not approved by the attorney general as required by A.R.S. § 41-1041(A), a provision of the Administrative Procedure Act (APA). The trial court subsequently found that the paragraph at issue was unlawful and that the proposed rules could not become effective until they were certified by the attorney general.

[218]*218While this appeal was pending, the commission, without waiving the APA issues on appeal, requested that the attorney general proceed with the certification process notwithstanding the appeal. The proposed rules were submitted to the attorney general for certification pursuant to A.R.S. § 41-1041(D) and the attorney general, after studying the rules, informed the commission that he would not certify because they were not within the commission’s power to adopt. See A.R.S. § 41-1041(A)(3).

The commission then filed a special action in the Arizona Supreme Court challenging the attorney general’s refusal to certify. The result of this special action is Arizona Corporation Commission v. State of Arizona, 171 Ariz. 286, 830 P.2d 807 (1992), where the court held that the proposed rules were within the ratemaking powers of the commission and ordered the attorney general to certify them. In footnote 3 of this decision the supreme court noted that the instant appeal was pending in this court but it did not purport to decide the issue which we now have before us, which is whether the corporation commission must submit its ratemaking rules to the attorney general for certification pursuant to A.R.S. § 41-1041. We hold that it need not.

At oral argument the state contended that this appeal should be dismissed as moot because of the decision in Arizona Corporation Commission v. State of Arizona, supra. We do not agree. The court of appeals will determine issues in a moot case where the case presents issues of great public importance or issues likely to be faced again. Fiesta Mall Venture v. Mecham Recall Committee, 159 Ariz. 371, 767 P.2d 719 (App.1988). At oral argument the state represented that it would continue to challenge corporation commission ratemaking rules that have not been submitted to the attorney general for certification.

The Arizona Constitution and Arizona precedent established the corporation commission as a separate, popularly-elected branch of the state government. Ariz. Const. art. 15, § 1. The broad power of the corporation commission is established by art. 15, § 3:

The Corporation Commission shall have full power to, and shall, prescribe just and reasonable classifications to be used and just and reasonable rates and charges to be made and collected, by public service corporations within the State for service rendered therein, and make reasonable rules, regulations, and orders, by which such corporations shall be governed in the transaction of business within the State, and may prescribe the forms of contracts and the systems of keeping accounts to be used by such corporations in transacting such business, and make and enforce reasonable rules, regulations, and orders for the convenience, comfort, and safety, and the preservation of the health, of the employees and patrons of such corporations; Provided, that incorporated cities and towns may be authorized by law to exercise supervision over public service corporations doing business therein, including the regulation of rates and charges to be made and collected by such corporations; Provided further, that classifications, rates, charges, rules, regulations, orders, and forms or systems prescribed or made by said Corporation Commission may from time to time be amended or repealed by such Commission.

(Emphasis added.)

As noted in Arizona Corporation Commission v. State of Arizona, supra, the foregoing constitutional provision gives the commission judicial, executive and legislative powers. It exercises its executive, administrative function in adopting rules and regulations, its judicial jurisdiction in adjudicating grievances, and its legislative power in ratemaking. The commission’s power goes beyond strictly setting rates and extends to enactment of the rules and regulations that are reasonably necessary steps in ratemaking. Ethington v. Wright, 66 Ariz. 382, 189 P.2d 209 (1948). The commission has the exclusive power to exercise the duties given it in art. 15, § 3. State v. [219]*219Tucson Gas, Electric Light and Power Co., 15 Ariz. 294, 138 P. 781 (1914).

Therefore, we proceed to the merits of this case. Ariz. Const. art. 15, § 6 contains the only powers that the legislature has relative to the corporation commission:

The law-making power may enlarge the powers and extend the duties of the Corporation Commission, and may prescribe rules and regulations to govern proceedings instituted by and before it; but, until such rules and regulations are provided by law, the Commission may make rules and regulations to govern such proceedings.

(Emphasis added.) Thus, the legislature can enact rules of practice and procedure governing the initiation and conduct of the proceedings before the commission.1 Examination of A.R.S. § 41-1041 discloses that it is not a rule governing the proceedings before the commission. It states:

Rule approval and certification by attorney general; withdrawal of rule

A. A rule adopted by an agency is subject to review and certification by the attorney general. The attorney general shall review and certify that the proposed rule is:

1. Approved as to form.

2.

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State Ex Rel. Corbin v. Arizona Corp. Commission
848 P.2d 301 (Court of Appeals of Arizona, 1992)

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Bluebook (online)
848 P.2d 301, 174 Ariz. 216, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-ex-rel-corbin-v-arizona-corp-commission-arizctapp-1992.