Town of Sterlington v. Greater Ouachita Water Co.

149 So. 3d 952, 2014 La. App. LEXIS 2318, 2014 WL 4853124
CourtLouisiana Court of Appeal
DecidedOctober 1, 2014
DocketNo. 49,315-CW
StatusPublished
Cited by3 cases

This text of 149 So. 3d 952 (Town of Sterlington v. Greater Ouachita Water Co.) 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
Town of Sterlington v. Greater Ouachita Water Co., 149 So. 3d 952, 2014 La. App. LEXIS 2318, 2014 WL 4853124 (La. Ct. App. 2014).

Opinion

DREW, J.

| )The Town of Sterlington (“Sterling-ton”) and Greater Ouachita Water Company (“GOWC”) entered into a franchise agreement in June of 1996 for GOWC to provide water to Sterlington. The franchise is set to expire in 2016.

On February 27, 2013, Sterlington filed a petition for injunctive and declaratory relief in the Fourth Judicial District Court after it learned that GOWC was forcing residential developers in Sterlington to donate or surrender ownership of water lines installed by the developers1 to GOWC in order for GOWC to provide water service to the developments.

Sterlington alleged that the franchise agreement did not require GOWC to own all the water lines. It further alleged that Sterlington owned a substantial number of the lines serviced by GOWC, and that Sterlington was going to develop its own water treatment facility to supply water upon the expiration of the franchise agreement. Sterlington sought a declaration that GOWC had violated the franchise agreement, as well as injunctive relief prohibiting GOWC from denying access to water to any individual or entity for failing to surrender and/or donate water lines to GOWC.

[954]*954After the district court granted a temporary restraining order and while the motion for preliminary injunction was pending, GOWC filed the exception of lack of subject matter jurisdiction. It claimed that any dispute with Sterlington relating to the terms and conditions of water service provided by GOWC was subject to the exclusive jurisdiction of the Louisiana Public Service Commission (“PSC”).

|aThe court denied the exception. GOWC applied for a supervisory writ, which this court granted. This court ordered that the record be lodged and further ordered the parties to brief the matter.

DISCUSSION

GOWC argues that only the PSC has original jurisdiction to determine its obligation to provide water service and the terms of that service. Sterlington seeks to compel GQWC to provide water service without requiring donation of water lines.

Sterlington counters that this is a case calling for the interpretation and enforcement of the franchise agreement, so it is a contract case properly before the district court in the first instance. Sterlington contends that GOWC is violating the franchise agreement by requiring the donation of water lines as a condition to receiving water. It further contends that the franchise agreement does not require that GOWC own the water lines, and in fact, a substantial portion of the lines in Sterling-ton are not owned by GOWC.

La. Const. Art. V, § 16(A) vests in the district courts “original jurisdiction of all civil and criminal matters,” unless there is other jurisdictional authorization in the constitution. Central Louisiana Elec. Co. v. Louisiana Public Service Com’n, 601 So.2d 1383 (La.1992).

La. Const. Art. IV, § 21(B) vests jurisdiction over public utilities in general and rates in particular in the PSC. Daily Advertiser v. Trans-La, a Div. of Atmos Energy Corp., 612 So.2d 7 (La.1993). It provides that:

The commission shall regulate all common carriers and public utilities and have such other regulatory authority as provided |aby law. It shall adopt and enforce reasonable rules, regulations, and procedures necessary for the discharge of its duties, and shall have other powers and perform other duties as provided by law.

This provision has been interpreted as affording the PSC broad, independent and plenary regulatory powers over public utilities. Gulf States Utilities Co. v. Louisiana Public Service Com’n, 92-1185 (La.3/17/94), 633 So.2d 1258. This plenary authority includes the right to exercise all necessary power and authority over public utilities for the purpose of fixing and regulating rates charged or to be charged by, and service furnished by, such public utilities. Id.

The supreme court concluded in Louisiana Power & Light Co. v. Louisiana Public Service Com’n, 609 So.2d 797 (La.1992), that in light of this broad plenary power, the PSC had the authority to select between two public utilities competing to provide service to a subdivision.

The manner in which a plaintiff couches his claim does not automatically vest jurisdiction in the district court; rather, the nature of the relief demanded is dispositive. Daily Advertiser, supra; Central Louisiana Elec. Co., supra. Nor does the fact that a party to an action qualifies as a public utility automatically divest a court of original jurisdiction; however, that fact renders La. Const. Art. IV, § 21(B) arguably applicable. Daily Advertiser, supra.

[955]*955La. R.S. 45:1163(A)(1) provides that “[t]he commission shall exercise all necessary power and authority over any street railway, gas, electric light, heat, power, waterworks, or other local public utility for the purpose of fixing and regulating the rates charged or to be charged by and service |4furnished by such public utilities.”

The power, authority, and duties of the PSC shall affect and include all matters and things connected with, concerning, and growing out of the service to be given or rendered by such public utility, except in Orleans Parish. La. R.S. 45:1164(A).

The supreme court has discussed the framework for selecting between the PSC’s authority to regulate rates and the district court’s authority to apply and enforce Louisiana laws:

Thus, the PSC has constitutional and statutory jurisdiction over subject matters which principally involve the right to fix and regulate rates charged by and services furnished by public utilities. The Legislature has never “provided by law” for the PSC to exercise jurisdiction over other subject matters and areas of litigation in which public utilities are involved, such as tort actions and contract disputes. It is therefore necessary at the outset to determine the relief demanded by all parties in order to resolve the subject matter jurisdiction issue.

Central Louisiana Elec. Co., 601 So.2d at 1386.

A district court was found to have subject matter jurisdiction in Central Louisiana Elec. Co., supra, to settle a dispute between CLECO and the City of Franklin over contractual and statutory issues. CLECO, which held a franchise agreement with Franklin to supply electricity to the entire city, contended that its contractual rights were impaired when the city entered into a franchise agreement with another utility company to supply electricity to a newly annexed part of the city. CLE-CO sought an interpretation of its contract as to whether the exclusivity provision in the contract was valid and whether the city had the right to grant another franchise covering the annexed area. In reaching its conclusion, the ^supreme court acknowledged the limits of the PSC’s expertise:

Inasmuch as the PSC cannot invalidate a franchise on the basis of absence of public convenience and necessity, an area which the PSC has general expertise, then the PSC normally would not be the appropriate tribunal to invalidate (or enforce) a franchise on the basis of contractual, constitutional or statutory provisions, which is not generally an area of PSC expertise.

Id., 601 So.2d at 1387. ■

In Daily Advertiser, supra,

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149 So. 3d 952, 2014 La. App. LEXIS 2318, 2014 WL 4853124, Counsel Stack Legal Research, https://law.counselstack.com/opinion/town-of-sterlington-v-greater-ouachita-water-co-lactapp-2014.