Oil Transport Co. v. New Mexico State Corp. Com'n, 18212
| Decision Date | 17 July 1990 |
| Docket Number | No. 18212,18212 |
| Citation | 798 P.2d 169,110 N.M. 568,1990 NMSC 72 |
| Parties | OIL TRANSPORT COMPANY, Plaintiff-Appellant, v. NEW MEXICO STATE CORPORATION COMMISSION, Eric P. Serna, John H. Elliott and Jerome D. Block, Defendants-Appellees, and Groendyke Transport, Inc., Alfred Hite and Shelby Hite, d/b/a Ash, Inc., and Steere Tank Lines, Inc., Intervenors-Appellees. |
| Court | New Mexico Supreme Court |
This matter coming on for consideration by the court on motion for rehearing and the court having considered said motion and being sufficiently advised, now, therefore, the opinion handed down on April 24, 1990 is hereby withdrawn and the opinion filed this date is substituted therefor.
Oil Transport Company (OTC) appeals a district court judgment affirming New Mexico State Corporation Commission's (Commission) orders denying OTC's application for a certificate of public convenience and necessity and granting Ash, Inc.'s (Ash) application. We reverse in part, affirm in part, and remand with instructions.
In December 1986 Ash applied to the Commission for a certificate of public convenience and necessity to transport petroleum products statewide. See NMSA 1978, Secs. 65-2-80 to -127 (Repl.Pamp.1981). OTC filed a similar application in February 1987. The Commission heard Ash's application on March 25 and 26, 1987, and heard consolidated applications of OTC and Mission Petroleum Carriers, Inc. (Mission) on May 6, 7, and 8, 1987. OTC and Steere Tank Lines, Inc. (Steere) intervened to protest Ash's application. Ash, Steere, and Groendyke Transport, Inc. (Groendyke) intervened to protest the OTC and Mission applications. Prior to Ash's application hearing, and again on April 13, 1987, OTC moved to consolidate the Ash and OTC application hearings for comparative review. The motions were denied by operation of law when the Commission failed to act on them prior to entering final orders on each application. The Commission granted Ash's application on October 19, 1987, and denied the OTC and Mission applications on October 29, 1987.
On January 7, 1988, OTC separately appealed both Commission orders to the district court claiming they were arbitrary, biased, and unsupported by substantial evidence. OTC also claimed the Commission's failure to consolidate the Ash and OTC applications denied OTC due process and equal protection. OTC consolidated its appeals on March 7, 1988. On February 3, 1988, the Commission filed its answer, in which it denied its orders were improper and claimed OTC lacked standing to appeal the grant of Ash's application since OTC was merely an intervenor in that proceeding.. On April 18, 1988, OTC amended its appellate complaints to include claims that the Commission discriminated against OTC, a Nevada corporation owned by a Lebanese national, in violation of 42 U.S.C. Sections 1981 and 1983 (1982) and erred in assessing record preparation costs against OTC. OTC also sought attorney fees under 42 U.S.C. Section 1988 (1982). The Commission denied these claims. The district court granted Ash, Groendyke, and Steere the right to intervene in these proceedings pursuant to Section 65-2-120(C).
On August 11, 1988, the district court vacated the Commission's orders and remanded for comparative review of the Ash and OTC applications and a resolution of conflicts in the Commission's findings of fact and conclusions of law. The court declined to review OTC's discrimination claims and claims for attorney fees and costs, since they were not raised before the Commission. The court concluded the Commission's grant of Ash's application was supported by substantial evidence and ordered the Commission to correct a clerical error in Ash's certificate if, after comparative review, Ash qualified for a certificate.
On August 30, 1988, OTC moved the court to reconsider its conclusion that substantial evidence supported the Commission's grant of Ash's application, as it conflicted with the court's vacation and remand of the Commission orders. The court denied this motion on September 2, 1988, stating there was no conflict since the two applications were not mutually exclusive as an economic fact. The court retained jurisdiction to review the Commission's orders entered upon remand.
On remand, the Commission affirmed its orders on grounds that Ash presented substantial evidence the public needed its services and OTC did not. The Commission also found OTC's intervenors showed substantial evidence that granting OTC's application would contravene public convenience and necessity. The Commission again concluded that the applications were not mutually exclusive as an economic fact, but did not make a comparison of Ash and OTC's qualifications as carriers.
On October 12, 1988, OTC moved the district court for relief from the Commission's orders on the above grounds. On December 13, 1988, the court denied this motion, finding that the Commission complied with the remand instructions and that the orders were supported by substantial evidence. OTC appeals the district court's judgment.
On appeal OTC asserts: (1) the Commission's denial of its application was not supported by substantial evidence; (2) the Commission's orders were arbitrary; (3) the Commission's orders were domestically biased against OTC, in violation of 42 U.S.C. Sections 1981 and 1983 (1982); and (4) the Commission erred in assessing record preparation costs against OTC. No appeal was taken from the district court's order directing the Commission to comparatively review the Ash and OTC applications. In view of this fact, the issue before us is not whether a comparative review was required, but rather, whether the Commission complied with the district court's order and comparatively reviewed the applications.
On review we must determine whether the Commission's orders were: (1) within the scope of its authority; (2) supported by substantial evidence; (3) arbitrary, capricious, or fraudulent; or (4) the result of bias or an abuse of discretion. NMSA 1978, Sec. 12-8-22(A) (Repl.Pamp.1988); Groendyke Transp., Inc. v. New Mexico State Corp. Comm'n, 101 N.M. 470, 477, 684 P.2d 1135, 1142 (1984). In making this determination, we independently review the whole record for district court error. National Council on Compensation Ins. v. New Mexico State Corp. Comm'n, 107 N.M. 278, 282, 756 P.2d 558, 562 (1988). On appeal we may correct an administrative agency's misapplication of the law. Conwell v. City of Albuquerque, 97 N.M. 136, 138, 637 P.2d 567, 569 (1981); Ortiz v. New Mexico Employment Sec. Dep't, 105 N.M. 313, 315, 731 P.2d 1357, 1359 (Ct.App.1986).
OTC does not dispute the Commission's authority to decide common carrier applications. The Commission has constitutional authority to determine matters of public convenience and necessity relating to common carriers. N.M. Const. art. XI, Sec. 7. The Commission also has statutory authority to establish reasonable license requirements to perform its functions. NMSA 1978, Sec. 65-2-83(C) and (D) (Cum.Supp.1989). We discuss OTC's issues in this context.
OTC argues substantial evidence does not support the Commission's denial of OTC's application due to its failure to consider Ash's evidence of public need for a statewide petroleum carrier in evaluating OTC's application. Substantial evidence supporting administrative agency action is relevant evidence that a reasonable mind might accept as adequate to support a conclusion. National Council on Compensation Ins. v. New Mexico State Corp. Comm'n, 107 N.M. 278, 282, 756 P.2d 558, 562 (1988); Viking Petroleum, Inc. v. Oil Conservation Comm'n, 100 N.M. 451, 453, 672 P.2d 280, 282 (1983).
Except as provided in NMSA 1978, Section 65-2-84 (Repl.Pamp.1981), the Commission shall issue a certificate of public convenience and necessity authorizing the applicant to provide transportation as a common carrier under the Motor Carrier Act if it finds:
(1) that the person is fit, willing and able to provide the transportation to be authorized by the certificate and to comply with the Motor Carrier Act and regulations of the commission; and
(2) on the basis of evidence presented by persons supporting the issuance of the certificate, that the service proposed will serve a useful public purpose, responsive to a public demand or need.
NMSA 1978, Sec. 65-2-84(D) (Repl.Pamp.1981). See also Groendyke Transp., Inc. v. New Mexico State Corp. Comm'n, 101 N.M. 470, 473, 684 P.2d 1135, 1138 (1984). Notwithstanding an applicant's prima facie showing pursuant to Section 65-2-84(D), the Commission must deny an application if it finds, based on intervenor and protestant evidence, that a grant would be inconsistent with public convenience and necessity. Id. at 473-74, 684 P.2d at 1138-39; see also Secs. 65-2-84(E), (F).
The Commission denied OTC's application in part for failure to show, in its hearing, a public need for its services. The Commission's order was based on a strict interpretation of NMSA 1978, Section 65-2-84(D) (Repl.Pamp.1981), which requires "persons supporting the issuance of the certificate ..." to present evidence the public needs their services. (emphasis added). We disagree with this interpretation of the statute.
Prima facie evidence of public need is established by identifying: (1) commodities to be shipped; (2) points to and from which traffic moves; (3) the volume of...
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