Alabama Power Co. v. City of Fort Payne

• Decision Date: 02 February 1939
• Docket Number: 3 Div. 284.
• Citation: 187 So. 632,237 Ala. 459
• Parties: ALABAMA POWER CO. v. CITY OF FORT PAYNE ET AL.
• Court: Alabama Supreme Court

187 So. 632

237 Ala. 459

ALABAMA POWER CO. v. CITY OF FORT PAYNE ET AL.

3 Div. 284.

Supreme Court of Alabama

February 2, 1939

Rehearing Granted March 23, 1939.

Appeal from Circuit Court, Montgomery County.

Certiorari proceeding by the Alabama Power Company against the City of Fort Payne and others to review an order of the Public Works Board of Alabama authorizing the City of Fort Payne to issue revenue bonds for purpose of acquiring an electric distribution system. From a judgment denying writ of certiorari, the Alabama Power Company appeals.

Reversed with directions to remand.

Steiner Crum & Weil, of Montgomery, and Martin, Turner & McWhorter of Birmingham, for appellant.

A. A. Carmichael, Atty. Gen., C. L. Rowe, Asst. Atty. Gen., and Thos. S. Lawson, of Montgomery, for appellees.

KNIGHT Justice.

The appellant, Alabama Power Company, prosecutes this appeal from a judgment of the Circuit Court of Montgomery County, denying appellant's petition for a writ of certiorari to the Public Works Board of Alabama.

The petition for the writ of certiorari was duly verified, and disclosed the following facts, among others to which we will hereafter refer: The City of Fort Payne filed its application, under the provisions of the Municipal Revenue Bond Code, Acts 1935, pp. 195-199, with the Public Works Board of Alabama (hereafter referred to as the Public Works Board, or simply as the Board) for the consent of that Board to the issuance of municipal revenue bonds in the aggregate amount of $73,000 for the partial financing of the construction of a municipal electric distribution system in said city. The application averred that the Public Works Administration had indicated its willingness to purchase such bonds, and in addition to make a grant to said city of $59,727 to complete the financing of the proposed municipal project.

The Public Works Board, on November 30, 1938, held a hearing on the application of the said city, at which time the appellant entered its appearance, and protested the granting of the city's application on the ground that the issuance of the proposed securities would be contrary to the public interest and serve no public need. The appellant at said hearing offered evidence showing that it owned and operated an integrated public utility system extending throughout the State of Alabama, serving some six hundred municipalities and communities in the State of Alabama, including the City of Fort Payne; that its said system is modern and efficient, and sufficient to meet the present needs in electric service in Alabama, and the anticipated future needs; that appellant is the owner of a modern and efficient electric distribution system and other electric facilities in the City of Fort Payne, Alabama, and is, and has been for a number of years, operating such distribution system and facilities, in said City, under a valid and unexpired franchise granted by the city and is rendering efficient and adequate service at reasonable rates to said city and its inhabitants. That the proposed municipal distribution system in the City of Fort Payne will substantially duplicate and parallel the appellant's existing system, and render substantially the same service now rendered by appellant's system.

In further support of its protest before the Public Works Board appellant introduced evidence to show, among other things: That considered apart from the damage to the appellant's integrated system which would result from the destruction of the value of appellant's existing system in Fort Payne, and considered apart from the interest of appellant and the general public in the settlement of the existing competitive situation between appellant and Tennessee Valley Authority, the monetary costs and losses which will accrue to the United States, the State of Alabama, the County of DeKalb, the City of Fort Payne and the appellant by the construction of the municipal system will be greater than the benefits which will accrue to the said city and its inhabitants.

The petition for the writ of certiorari contained the following direct and explicit averment: "Respondent City of Fort Payne did not introduce or offer any evidence in support of its petition for the approval of the issuance of its securities and no other evidence was offered or introduced in support thereof."

At the conclusion of the hearing, the Board entered an order reciting "That the Public Works Board of Alabama hereby finds and determines that the issuance and sale of $73,000.00 principal amount of electric system revenue bonds of 1938 by the City of Fort Payne, Alabama, for the purpose of acquiring by construction or otherwise an electric distribution system, serves a definite and recognized public need and is in the public interest." By order dated November 30, 1938, the Public Works Board granted its consent for the issuance of said bonds. The appellant sought by certiorari to review the findings and order of the Board. The writ was denied by the court below, and from that judgment this appeal is prosecuted.

It is the contention of appellant that the order of the Board of Public Works was made and entered without substantial support in the evidence, or was contrary to the undisputed evidence, or in disregard of legal and competent evidence.

The statute requiring action by the Public Works Board, so far as here material, reads: "Section 14. When required by law, the approval of the State Board of Health with respect to water and sewer systems shall be obtained. No bonds or obligations of any municipality authorized under this Act shall be issued and/or sold until consent to the issuance and sale thereof shall have been given by the Public Works Board of Alabama or in the event no such body is in existence at the time, by the Alabama Public Service Commission, to be evidenced by resolution or order under seal of such body granting such consent. Such consent shall be granted only after a public hearing and after a petition requesting such consent has been duly filed by such municipality with the secretary of such Public Works Board more than five days before such public hearing. Such petition shall specify the plan or program of the municipality and the uses to which it is proposed to put the proceeds of such issue and such other matters as are necessary fully to advise such Public Works Board of the nature of the corporate purpose in furtherance of which such issue is proposed and said petition shall include such other information as may be required by the rules of such Public Works Board. Such Public Works Board shall grant such consent only after it finds that such issue and/or sale serves some public need, and is in the public interest."

We are confronted at the outset with the insistence that appellant had no such interest in the proceedings before the Public Works Board as would confer upon it the right to intervene and contest the application and petition of the City of Fort Payne. We do not think there is merit in this insistence. The appellant showed by its petition that it owns property in the City of Fort Payne and operates there an electric distribution system. While there is absent from the petition a specific allegation that appellant is a taxpayer in said city, yet we know that one cannot own and operate such property without being a taxpayer.

It appears that the appellant was a party to the record in the proceedings before the Board, and was so recognized by the Board. This then brings this case squarely within the principle and rule in the case of St. John et al. v. Richter et al., 167 Ala. 656, 52 So. 465. The record facts and the nature of the proceedings differentiate this case from that of Birmingham Electric Company v. City of Bessemer et al., Ala.Sup., 186 So. 569.

It is obvious that the above quoted statute makes it obligatory upon the Public Works Board to withhold its consent to the issuance and sale of the bonds until a public hearing has been had upon the application therefor, and such consent shall then be granted only after it finds that such issue or sale of said bonds will serve some public need, and is in the public interest.

No one, we take it, will argue for a moment that the Legislature did not intend, when it employed the word "finds," that such finding shall be made or reached only upon evidence duly submitted to, and considered by the Board. To ascribe to the word "finds" any other meaning would do violence to the plain and unambiguous words of the statute.

We, therefore, feel fully justified in concluding that it was the purpose of the act to require the Board to give its consent to the issuance and sale of bonds only after a public hearing has been had, and after receiving sufficient competent evidence to justify it--the Board--in finding that such issue and sale would serve some public need, and is in the public interest.

If the Board had, in fact, evidence before it tending to show that the issuance and sale of the bonds would serve "some public need, and was in the public interest," it would be wholly immaterial whether such evidence was offered by the City of Fort Payne or by the intervenor. The petition for certiorari clearly shows, by proper averments, that the City of Fort Payne, upon the hearing before the Board, offered no evidence in support of its petition for approval of the issuance of its bonds, and that no other evidence was offered or introduced in support thereof.

So that when this petition for certiorari was submitted to Judge Jones, Judge of the Circuit Court of Montgomery County, it was made clearly to appear by that petition that the Board in total disregard of the statutory mandate, had proceeded in an arbitrary way to grant the city's petition. We say this, because the...