47 N.Y.2d 94, Consolidated Edison Co. of New York, Inc. v. Public Service Commission

Citation:47 N.Y.2d 94, 417 N.Y.S.2d 30
Party Name:Consolidated Edison Co. of New York, Inc. v. Public Service Commission
Case Date:May 01, 1979
Court:New York Court of Appeals

Page 94

47 N.Y.2d 94

417 N.Y.S.2d 30





PUBLIC SERVICE COMMISSION of the State of New York, Respondent. In the Matter of CENTRAL HUDSON GAS & ELECTRIC CORPORATION, Appellant,


PUBLIC SERVICE COMMISSION of the State of New York, Respondent.

New York Court of Appeals

May 1, 1979.

[417 N.Y.S.2d 32] Joseph D. Block and Peter Garam, New York City, for appellant in the first and second above-entitled proceedings.

Howard J. Read and Peter H. Schiff, Albany, for respondent in the first and second above-entitled proceedings.

Telford Taylor, Walter A. Bossert, Jr., and Davison W. Grant, New York City, for appellant in the third above-entitled proceeding.

Howard J. Read and Peter H. Schiff, Albany, for respondent in the third above-entitled proceeding.

Ronald D. Jones, Andrew Gansberg and Howard S. Ockman, New York City, for Edison Electric Institute and others, amici curiae.

Kristin Booth Glen, New York City, for Scientists' Institute for Public Information and others, amici curiae.


COOKE, Chief Judge.

We determine here whether the Public Service Commission exceeded its statutory authority or impinged upon First Amendment rights by restricting certain advertising and promotional practices of public utilities. For the reasons outlined, we hold that the Public Service Commission was within its authority in imposing the restrictions, and that petitioners' expressional rights were not unconstitutionally impaired. [417 N.Y.S.2d 33] I

Respondent, New York Public Service Commission, exercises regulatory and supervisory powers over public utilities licensed to operate in the State (see Public Service Law, §§ 5, 66). In 1973 the commission, reacting to the Arab oil embargo, prohibited electric corporations "from promoting the use of electricity through the use of advertising, subsidy payments * * * or employee incentives". Although the immediate crisis created by the embargo dissipated, no repeal of the promotional ban was effected by the commission. Then, in July of 1976, the commission issued a "Notice of Proposed Policy Statement and Request for Comments on Advertising by Public Utilities and Electric Promotion Practices." Petitioners, Central Hudson Gas & Electric Corporation and Consolidated Edison Company of New York, Inc., as well as other interested parties, responded to the notice, arguing for relaxation of the promotional ban on both policy and constitutional grounds.

After reviewing the comments received and conducting its evaluation of the problem, the commission rendered a decision on February 25, 1977 entitled "Statement of Policy on Advertising and Promotional Practices of Public Utilities." In its statement, the commission concluded "that the existing ban on promotion of electricity sales should be continued". Its reasoning for continuation of the prohibition was succinctly stated: "(C)onservation of energy resources remains our highest priority * * * It is reasonable to believe that a continued proscription of promotion of electric sales will result in some dampening of unnecessary growth so that society's total energy requirements will be somewhat lower than they would have been had electric utilities been allowed to promote sales."

That same day, the commission released an order addressing the topic of utility bill inserts. By that order, the commission directed all utilities subject to its jurisdiction to "discontinue the practice of utilizing material inserted in bills rendered to customers as a mechanism for the dissemination of the utility's position on controversial matters of public policy". This restriction, too, was partially explained in the commission's policy statement: "We believe that using bill inserts to proclaim a utility's viewpoint on controversial issues * * * is tantamount to taking advantage of a captive audience, since the consumer cannot avoid receiving the utility's message."

Dissatisfied with the decision, Central Hudson and Con Edison petitioned for a rehearing, which was denied by the commission on July 14, 1977. Central Hudson then commenced an article 78 proceeding challenging the advertising and insert bans. Con Edison instituted a separate proceeding in which it objected to only the billing insert measure. Special Term, in brief opinions, ruled that while the commission had power to impose the promotional advertising restriction, it lacked authority to prohibit the use of bill inserts. On appeal, the Appellate Division modified, sustaining both branches of the commission's determination.


At the outset, petitioners challenge the commission's statutory authority to regulate the content of billing envelopes and the promotional advertising practices of public utilities. It is, of course, a fundamental postulate of administrative law that the Public Service Commission, like other agencies, is possessed of only those powers expressly delegated by the Legislature, together with those powers required by necessary implication (see, e. g, Suffolk County Bldrs. Assn. v. County of Suffolk, 46 N.Y.2d 613, 415 N.Y.S.2d 821, 389 N.E.2d 133; Matter of National Merchandising Corp. v. Public Serv. Comm. of State of N. Y., 5 N.Y.2d 485, 489, 186 N.Y.S.2d 47, 49, 158 N.E.2d 714, 715; cf. Matter of Bates v. Toia, 45 N.Y.2d 460, 464, 410 N.Y.S.2d 265, 267, 382 N.E.2d 1128, 1130). Nevertheless, the absence of explicit statutory authorization [417 N.Y.S.2d 34] need not be fatal to a given assertion of regulatory power by the commission. For, as we have recognized previously, the Legislature on occasion broadly declares its will, specifying only the goals to be achieved and policies to be promoted, while leaving the implementation of a program to be worked out by an administrative body (see, e. g., Matter of Sullivan County Harness Racing Assn. v. Glasser, 30 N.Y.2d 269, 276, 332 N.Y.S.2d 622, 625, 283 N.E.2d 603, 606; cf. Matter of Bates v. Toia, supra ). In such cases, the sheer breadth of delegated authority precludes a precise demarcation of the line beyond which the agency may not tread. What is called for, rather, is a realistic appraisal of the particular situation to determine whether the administrative action reasonably promotes or transgresses the pronounced legislative judgment (cf. Matter of Broidrick v. Lindsay, 39 N.Y.2d 641, 646, 385 N.Y.S.2d 265, 267, 350 N.E.2d 595, 597).

In the context of this case, without doubt, the Legislature has conferred vast power upon the Public Service Commission (see, e. g., Public Service Law, §§ 4, 5, 65, 66; cf. Matter of Public Serv. Comm. of State of N. Y. v. Jamaica Water Supply Co., 42 N.Y.2d 880, 397 N.Y.S.2d 784, 366 N.E.2d 872, affg. 54 A.D.2d 10, 386 N.Y.S.2d 230). Indeed, the commission is expressly endowed with "all powers necessary or proper to enable it to carry out the purposes of" the Public Service Law (Public Service Law, § 4, subd. 1). Added to this is the...

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