Appeal of Global Moving & Storage of New Hampshire, Inc.

• Decision Date: 08 September 1982
• Docket Number: Nos. 81-203,81-248,s. 81-203
• Citation: 122 N.H. 784,451 A.2d 167
• Parties: Appeal of GLOBAL MOVING & STORAGE OF NEW HAMPSHIRE, INC. et al. (New Hampshire Public Utilities Commission).
• Court: New Hampshire Supreme Court

Page 167

451 A.2d 167

122 N.H. 784

Appeal of GLOBAL MOVING & STORAGE OF NEW HAMPSHIRE, INC. et al. (New Hampshire Public Utilities Commission).

Nos. 81-203, 81-248.

Supreme Court of New Hampshire.

Sept. 8, 1982.

Ransmeier & Spellman, Concord (Dom S. D'Ambruoso, Concord, on the brief and orally), for plaintiff Global Moving & Storage of N. H., Inc.

John L. Ahlgren, Portsmouth, by brief and orally, for plaintiff, Coastal Environmental Systems, Inc.

Cleveland, Waters & Bass, Concord (Michael C. Moyers, orally and on the brief, and Robert T. Clark, Concord, on the brief), for protestants.

BROCK, Justice.

In this appeal, Coastal Environmental Systems, Inc. (Coastal) and Global Moving & Storage of N. H., Inc. (Global) challenge an order of the public utilities commission (PUC) which vacated the PUC's prior authorization of a transfer of operating authority between Coastal and L. V. Regan Moving & Storage Company, Inc. (Regan). We reverse and remand.

In August 1972, Coastal was organized as a corporation to engage in rubbish disposal and general appliance delivery. In the fall of 1975, it purchased, among other businesses, the business of the Regan corporation. Regan first obtained its household goods carrier certificate from the PUC under the grandfather clauses of RSA 375-A:2 and RSA 375-B:4 (Supp.1981) and had been engaged in bona fide operations as a common property carrier since 1963. The PUC authorized transfer of their certificate to Coastal in December 1975. Until 1979, Coastal operated as a household goods carrier under that authority in the Portsmouth area.

Without a certificate issued by the PUC, authorizing household goods carrier operations, a company cannot operate such a business in New Hampshire. RSA 375-A:2; RSA 375-B:4 (Supp.1981). In order to obtain a certificate, a company may either purchase existing authority, (RSA 375-A:7; RSA 375-B:10 (Supp.1981)), or apply to the PUC for an original certificate (RSA 375-A:5 (Supp.1981); RSA 375-B:5 (Supp.1981)).

In the fall of 1979, Coastal decided to put its household goods carrier business up for sale. At the same time, Global, a moving business originally incorporated in Massachusetts, was examining the possibility of entering the New Hampshire market. Global's plan was to operate a statewide household goods moving business in New Hampshire. During their preliminary investigation into the possibility of purchasing property for utilization in a moving business in New Hampshire and of acquiring New Hampshire operating authority, representatives of Global met with a PUC inspector who informed them that Coastal had a household goods carrier's certificate for sale, and that it would be simpler and much less expensive to purchase an existing certificate than to request original operating authority from the PUC. Subsequently, negotiations between Coastal and Global began.

The PUC inspector, who had brought the parties together, told them that the best way for Global to purchase Coastal's operating authority was by stock sale. At that time the PUC's policy was to consider stock transfers as continuations of the same business, which did not require a transfer hearing, whereas "asset transfers" required such a hearing to determine whether the transferred authority was still active.

In April 1980, Coastal signed a preliminary non-binding offer to sell the stock in its household good carrier division to Global. Until the fall of 1980, however, Coastal continued to offer the household goods carrier business for sale and to negotiate for its sale with other interested parties.

In order to separate its household goods carrier business from its other operations, Coastal formed a new corporation, Regan. Because this transaction was deemed a transfer of assets, Coastal applied to the PUC for a transfer of its operating authority to Regan. Coastal retained its other business operations in its name. In their August 1980, application to the PUC for transfer of operating authority, Coastal and Regan stated that Regan would operate the moving and storage business, previously operated by Coastal, as a separate entity, but that Regan would continue to provide the same services at the same rates as Coastal had done until then. It further represented that the transfer was a purely internal and organizational measure and made no reference to the fact that Coastal had been attempting to sell its moving and storage business.

In September 1980, the PUC scheduled a hearing on the requested transfer and gave other certificate holders and the public notice. Three household goods carriers filed protests against Coastal's request for transfer of its operating authority. One of them advised the PUC that the dormancy (i.e. non-activity) of Coastal's authority could be an issue to consider in authorizing the asset transfer. None of the protestants, however, appeared at the September 15 hearing to oppose the transfer.

Noting that Coastal and Regan had common officers and stockholders, that Regan planned to continue to provide the same services at the same rates as Coastal, and stating simply that "Coastal appears to have operated under this certificate doing business as L. V. Regan Moving & Storage Co. Inc.," the PUC approved the transfer of operating authority from Coastal to Regan on September 25, 1980. It did not investigate the issue of the alleged dormancy of Coastal's authority.

On November 6, 1980, Global and Coastal entered into an agreement whereby Global would purchase the Regan stock from Coastal, and the sale was completed on November 20, 1980. On November 24, 1980, Global requested the PUC to process a name change on the operating authority. On November 26, 1980, according to its long-standing custom and procedure, the PUC routinely approved the name change from Regan to Global.

On December 4, 1980, fourteen household goods carriers filed a petition to suspend the order which granted the name change, making the following allegations: (1) the transfer of authority from Coastal to Regan was a subterfuge designed to facilitate the subsequent sale of stock to Global and circumvent the necessity of a full transfer hearing; (2) the authority held by Coastal at the time of the transfer to Regan was dormant; and (3) that Global had failed to demonstrate the public convenience and necessity for transforming a local company operating in the Portsmouth area into a statewide carrier.

The PUC held two hearings on the protestants' petition at which evidence was presented on the issue of dormancy of Coastal's operating authority, and on the...