Alpert v. Boise Water Corp., s. 17625
| Citation | 118 Idaho 136,795 P.2d 298 |
| Decision Date | 14 June 1990 |
| Docket Number | Nos. 17625,17629,s. 17625 |
| Parties | , 1990-2 Trade Cases P 69,109 Kenneth ALPERT and Flying H Trailer Ranch, Inc., for and on behalf of themselves and as representatives of all others similarly situated, Plaintiffs-Appellants, Cross-Respondents, v. BOISE WATER CORPORATION; Capital Securities Water Corporation, Intermountain Gas Company; City of Boise, Idaho; City of Meridian, Idaho; City of Eagle, Idaho; City of Kuna, Idaho; and City of Garden City, Idaho, Defendants-Respondents, Cross-Appellants. ADA COUNTY HIGHWAY DISTRICT, a body politic, Plaintiff in Intervention, v. BOISE WATER CORPORATION; Capital Securities Water Corporation; Intermountain Gas Company; City of Boise, Idaho; City of Meridian, Idaho; City of Eagle, Idaho; City of Kuna, Idaho; and City of Garden City, Idaho, Defendants in Intervention-Respondents, Cross-Appellants. Kenneth ALPERT and Flying H Trailer Ranch, Inc., for and on behalf of themselves and as representatives of all others similarly situated, Plaintiffs, v. BOISE WATER CORPORATION; Capital Securities Water Corporation, Intermountain Gas Company; City of Boise, Idaho; City of Meridian, Idaho; City of Eagle, Idaho; City of Kuna, Idaho; and City of Garden City, Idaho, Defendants-Respondents, Cross-Appellants. ADA COUNTY HIGHWAY DISTRICT, a body politic, Plaintiff in Intervention, Appellant, Cross-Respondent, v. BOISE WATER CORPORATION; Capital Securities Water Corporation; Intermountain Gas Company; City of Boise, Idaho; City of Meridian, Idaho; City of Eagle, Idaho; City of Kuna, Idaho; and City of Garden City, Idaho, Defendants in Intervention-Respondents, Cross-Appellants. |
| Court | United States State Supreme Court of Idaho |
Evans, Keane, Koontz, Boyd, Simko & Ripley, Boise, for plaintiffs-appellants, cross-respondents Alpert and Flying H. Larry D. Ripley, argued.
Holland & Hart, Langroise, Sullivan, Boise, for plaintiff-appellant, cross-respondent Ada County Highway Dist. J. Frederick Mack, argued.
Kenneth Bergquist, Boise, for defendants-respondents, cross-appellants Boise Water Corp. and Capital Securities Water Corp.
Moffatt Thomas Barrett Rock & Fields, Boise, for defendant-respondent, cross-appellant Intermountain Gas Co. Morgan W. Richards, Jr., argued.
Clemons Cosho & Humphrey P.A., Boise, for defendant-respondent, cross-appellant Cities of Boise, Eagle, Kuna and Garden City. David M. Penny, argued.
Ambrose, Fitzgerald & Crookston, Meridian, for defendant-respondent, cross-appellant City of Meridian. Wayne Crookston, argued.
In this utility franchise case we are called upon to determine the authority of cities to enter into utility franchise agreements and also to determine the validity of franchise fees paid to the cities by the utilities which are eventually passed on to the consumers and ratepayers.
The cities of Boise, Meridian, Eagle, Kuna and Garden Valley (hereafter Cities) entered into various gas and water utility franchise agreements with the Boise Water Corporation, Capital Securities Water Corporation and Intermountain Gas Company (hereafter Utilities). While only the City of Boise has franchise agreements with Boise Water Corporation and Capitol Securities Water Corporation, each of the cities of Boise, Eagle, Meridian, Kuna and Garden City have franchise agreements with Intermountain Gas Company. Each of the franchise agreements is embodied in a city ordinance adopted by the respective city governments. The franchise agreements provide that as consideration the cities will not engage in the business of the utility or enter into competition with the utilities. The franchise agreements provide a grant of authority giving the utilities the right and authority for a specific term of years to maintain a transmission and distribution system within the public areas of the city limits. Section 1 in the franchise agreement existing between the city of Boise and Intermountain Gas Company is illustrative of grants contained in all of the franchise agreements.
It is hereby granted to Intermountain Gas Company, a corporation, its successors (hereafter collectively referred to as "Grantee") a twenty (20) year extension to the right and authority to construct, install, maintain and operate the gas transmission and distributing system, including mains, pipes, conduits, services and other necessary structures and appliances appertaining in, under, upon, over, across and along the streets, alleys, bridges and public places within the present and future corporate limits of the City of Boise, Idaho (hereafter referred to as "City") for the furnishing, transmission, distribution and sales of gas, whether artificial, natural, mixed or otherwise, for heating, domestic, industrial and other purposes and for transmitting gas into, through and beyond said City.
Each of the franchise agreements provides that the utility shall pay to the city three percent of the gross annual receipts from all sales in the corporate limits as consideration for the franchise contract. The Idaho Public Utilities Commission allowed the utilities to meet their respective obligations to the cities by surcharging the utilities customers' accounts.
On March 12, 1987, appellants Kenneth Alpert and Flying H Trailer Ranch, Inc. filed a complaint in district court against the cities and also named as parties the utilities supplying gas and water service within the city boundaries. The complaint primarily alleged that the cities lacked authority to grant the franchises and impose the franchise fees. Ada County Highway District (ACHD) was allowed to intervene by order of the court. All parties subsequently
[118 Idaho 139] filed motions for summary judgment. The district court heard arguments, issued a memorandum decision upholding the franchise agreements as valid and issued an order denying the motions for summary judgment by Alpert and Flying H and ACHD. The court also denied the request by Alpert and Flying H that it certify a class action.
The following issues are presented: 1) whether the plaintiffs have standing to bring this action; 2) whether this action was properly brought before the district court; 3) whether an antitrust action is presented; 4) whether the cities have the power and authority to contract with utilities; 5) whether the contracts awarding franchises between the utilities and the cities are valid and whether the franchise fee is proper consideration; and, 6) whether attorney fees should be awarded on appeal.
The first issue presented is whether the plaintiffs Alpert and Flying H have standing to challenge the validity of the franchise fee. We answer this question in the affirmative and hold that these plaintiffs have standing to bring this action.
In Miles v. Idaho Power Co., 116 Idaho 635, 778 P.2d 757 (1989), we considered whether or not an individual ratepayer had standing to challenge an agreement entered into between the State of Idaho and Idaho Power Company. In Miles, the plaintiff was found to have standing as a customer and ratepayer to challenge the constitutionality of the legislation. In Miles we stated:
The parties allegedly injured by the agreement are the ratepayers and customers of Idaho Power, and not the general populace of the state of Idaho. This is more than a generalized grievance. It is a specialized and peculiar injury, although it may affect a large class of individuals. The political process obviously will be more unkind to injured ratepayers seeking to change legislation affecting the whole state of Idaho than to injured citizens and taxpayers. When the impact of legislation is not felt by the entire populace, but only by a selected class of citizens, the standing doctrine should not be evoked to usurp the right to challenge the alleged denial of constitutional rights in a judicial forum.
Nevertheless, the respondents urge us to invoke the doctrine because of the large class of Idaho Power ratepayers. They argue that Miles, as only one of thousands of customers, suffered a generalized injury, which, when compared to the benefits the compromise afforded to all of the people of Idaho is de minimis and insubstantial. This may be true, but we fail to see how this factor requires a dismissal upon lack of standing. "To deny standing to persons who are in fact injured simply because many others are also injured, would mean that the most injurious and widespread Government actions could be questioned by nobody." United States v. SCRAP, 412 U.S. 669, 687-88, 93 S.Ct. 2405, 2416, 37 L.Ed.2d 254 (1973). This statement is particularly true here. There is no question that the agreement impacts Idaho Power ratepayers. The State and Idaho Power, as part of their agreement, have pledged "actively and in good faith" to recommend and support the implementing legislation. Idaho Power ratepayers are therefore the group most adverse to the agreement, not Idaho Power or the State. Because of that fact, and the fact that Miles challenges the implementing legislation as a ratepayer, and not as a taxpayer, we hold that Miles has standing to pursue his remedy in the courts. (Emphasis added.)
Id., 116 Idaho at 642, 778 P.2d at 764.
In the present case the plaintiffs Alpert and Flying H challenge the validity of the franchise fee characterizing it as a tax. It is undisputed that the franchise fees are ultimately paid by these plaintiffs and the other residents of the municipality using the utility. Although the plaintiffs are not parties to the franchise agreement, they are directly affected by the agreement imposing the three percent fee and clearly have standing to bring this action. Miles v. Idaho Power Co., 116 Idaho 635, 778 P.2d 757 (1989).
Several of the parties assert that only the Idaho Public Utilities Commission has jurisdiction to review and resolve the issues presented. We disagree and hold that the issues presented are best resolved by the courts rather than by an administrative...
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