Williams v. Public Service Commission of Utah

642 P.2d 707, 1982 Utah LEXIS 891
CourtUtah Supreme Court
DecidedFebruary 9, 1982
DocketNo. 17410
StatusPublished

This text of 642 P.2d 707 (Williams v. Public Service Commission of Utah) is published on Counsel Stack Legal Research, covering Utah Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Williams v. Public Service Commission of Utah, 642 P.2d 707, 1982 Utah LEXIS 891 (Utah 1982).

Opinion

HOWE, Justice:

Protestant David R. Williams d/b/a Industrial Communications (Industrial) petitioned this Court for a writ of review seeking to have a Report and Order of the Public Service Commission of Utah (PSC) reversed. The order partially granted and partially denied the application of Mobile Telephone, Inc. (Mobile) to amend its Certificate of Convenience and Necessity to expand its area of operation.

Industrial raises three issues: (1) The PSC erred in refusing to admit evidence material to Mobile’s fitness; (2) The PSC erred in not permitting Industrial to examine certain financial data of Mobile; and (3) Mobile failed to prove a need for its service and its ability to serve in some of the areas of Utah where it was granted authority.

[708]*708Mobile and Industrial are competitors, both offering mobile telephone service as radio common carriers in areas of Utah and are regulated by the PSC. The principal stockholder of Mobile is also the principal stockholder of Mobile Radio Telephone of Southern Utah, Inc., a separate, regulated carrier. Industrial attempted to present evidence at the hearing that the principal stockholder of both Mobile corporations misrepresented certain equipment capacity of the southern Utah corporation to the Federal Communications Commission. The Commission ruled that the acts of the southern Utah corporation were not material to the proceeding because of the distinctness of the corporate entities and lack of any allegation that there should be a piercing of the corporate veil. The Commission also did not allow Industrial to examine the profit and loss statement and current cash flow statements of Mobile based upon a ruling that they were confidential. However, the Division of Public Utilities and the Commission did thoroughly examine Mobile’s financial information. Based upon evidence presented, the Commission denied Mobile authority to operate in three counties but granted all of the other authority it sought.

I.

Industrial mischaracterizes the Commission’s examination of Mobile’s qualifications as being limited to a determination of its financial ability. The Commission did consider fitness beyond financial ability and did recognize the possible relevance of Industrial’s allegations concerning Mobile’s credibility and fitness. However, the Commission believed that the allegations, even if true, were too remote to be of significant probative value in determining Mobile’s fitness. The Commission stated its reasons for ruling against Industrial:

... even if it could be demonstrated that there had been a misrepresentation before the Federal Communications Commission in behalf of a separate company [sic] ... that might go to the weight to be given on statements made by ... [the principal stockholder of both Mobile corporations] in this proceeding before this Commission. Since it appears from the application that the proposal [of Mobile] is entirely separate from whatever is occurring in Southern Utah [sic] the bearing would be very slight if any.

Rule 45 of the Utah Rules of Evidence, which has been adopted by the PSC in No. 16.1 of its Rules of Practice and Procedure, allows a judge, in his discretion, to exclude evidence which is otherwise admissible if its probative value is substantially outweighed by the risk that its admission will necessitate undue consumption of time. This is supported in case law. Terry v. Zions Cooperative Mercantile Institution, Utah, 605 P.2d 314 (1979); Martin v. Safeway Stores, Inc., Utah, 565 P.2d 1139 (1977).

In order to discover whether a misrepresentation had occurred, Industrial wanted to inspect, or have the Commission inspect, the premises of the Mobile Radio Telephone of Southern Utah corporation (not the applicant). Industrial also offered to present three witnesses who would testify that equipment which the principal stockholder of both Mobile corporations represented to the FCC that the southern Utah company had put in place was not observed by them on its premises. (The absence of the equipment would not be a violation of Utah law).

These points raised by Industrial, although logically relevant, could reasonably be considered excludable since they would consume a disproportionate amount of time in a three-day application hearing. Three witnesses, cross-examination, and a possible investigatory trip could require a substantial amount of time in the hearing or necessitate continuances of the hearing. It is likely also that, once developed, the evidence would not carry sufficient weight to justify the time it imposed upon the Commission. In other words, an FCC violation by the principal stockholder’s other corporation would not sufficiently damage his credibility to prove applicant Mobile’s unfitness. As the commission recognized, regulatory misconduct is one factor to consider in determining fitness. Unless fraud can be [709]*709shown in the common ownership of two corporations, RenaWare Distributors v. State, 77 Wash.2d 514, 463 P.2d 622 (1970), and a violation is willful and intentional, Uintah Freightlines v. Public Service Commission, 119 Utah 491, 229 P.2d 675 (1951), such misconduct as was alleged by Industrial here is too remote to require consideration. Therefore, on this point the Commission did not abuse its discretion.

II.

The Commission also did not allow Industrial to review confidential documents prepared for the PSC by Mobile. (Industrial was allowed to cross-examine financial and other witnesses). The documents consisted of a detailed budget showing planned expenditures, including sources and uses of funds, a detailed income statement, and a detailed statement showing amounts of debt and the dates the debts matured. Industrial argues that the Commission’s ruling was error because “no party” cross-examined this “one-sided evidence.” However, after having reviewed the documents as well as other financial information, the Division of Public Utilities determined to forego cross-examination of the financial issue and represented to the PSC that it was satisfied with the data. Hence, while it may be true that cross-examination was not formally conducted, the implication that the evidence was not reviewed and as a result was “one-sided” simply is not the case.

Industrial also claims that the classification of the documents as confidential by the Commission was erroneous; but Industrial offers no support for the assertion.

Rule 26(c) of the Utah Rules of Civil Procedure which was adopted by the PSC in No. 21.6 of its Rules of Practice and Procedure allows discretionary treatment of evidence by providing in pertinent part that the court

.. . may make any order which justice requires to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense, including . .. (7) that a trade secret or other confidential research, development, or commercial information not be disclosed or be disclosed in a designated way; . ..

This Court will not overturn the Commission’s exercise of its discretion unless it can be shown that the Commission abused it. Utah Department of Business Regulations v.

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Related

Rena-Ware Distributors, Inc. v. State
463 P.2d 622 (Washington Supreme Court, 1970)
Uintah Freight Lines v. Public Service Commission
229 P.2d 675 (Utah Supreme Court, 1951)
Martin v. Safeway Stores, Inc.
565 P.2d 1139 (Utah Supreme Court, 1977)
Lake Shore Motor Coach Lines, Inc. v. Welling
339 P.2d 1011 (Utah Supreme Court, 1959)
Terry v. Zions Cooperative Mercantile Institution
605 P.2d 314 (Utah Supreme Court, 1979)
Union Pac. R. v. Public Service Commission
135 P.2d 915 (Utah Supreme Court, 1943)
Mulcahy v. Public Service Commission
117 P.2d 298 (Utah Supreme Court, 1941)
Utah Light & Traction Co. v. Public Service Commission
118 P.2d 683 (Utah Supreme Court, 1941)
Commonwealth v. D'Agata National Trucking Co.
360 A.2d 279 (Commonwealth Court of Pennsylvania, 1976)

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Bluebook (online)
642 P.2d 707, 1982 Utah LEXIS 891, Counsel Stack Legal Research, https://law.counselstack.com/opinion/williams-v-public-service-commission-of-utah-utah-1982.