Big Three Industries, Inc. v. Railroad Commission of Texas
| Decision Date | 29 April 1981 |
| Docket Number | No. B-9651,B-9651 |
| Citation | 618 S.W.2d 543 |
| Parties | BIG THREE INDUSTRIES, INC., Petitioner, v. RAILROAD COMMISSION OF TEXAS et al., Respondents. |
| Court | Texas Supreme Court |
Anderson, Brown, Orn & Jones, Nelson Jones, Liddell, Sapp, Zivley, Brown & LaBoon, Robert J. King and William W. Ogden, Houston, Thomas Ausley, Austin, Orgain, Bell & Tucker, John G. Tucker, Paul W. Gertz and D. Allen Jones, Beaumont, for petitioner.
Mark White, Atty. Gen., and J. Scott Wilson Asst. Atty. Gen., Austin, Clyde A. Mote, Houston, Graves, Dougherty, Hearon & Moody, Dan Moody, Jr., Austin, for respondents.
Big Three Industries sought a temporary injunction to enjoin enforcement of a Railroad Commission order allowing Amoco Gas Company to pass through its increased costs on gas obtained from Lo-Vaca Gathering Company. The trial court granted the temporary injunction. The Court of Civil Appeals reversed and vacated the temporary injunction. 601 S.W.2d 186. We reverse the judgment of the Court of Civil Appeals. 1
Big Three Industries, Inc. has a fixed price gas sales contract with Amoco Gas Company. Amoco buys part of the gas sold to Big Three from Lo-Vaca Gathering Company and its successors. Lo-Vaca filed a petition with the Railroad Commission of Texas seeking review and revision of Lo-Vaca's contracts with its customers and permission for gas cost adjustment in those contracts. The case between Lo-Vaca and its customers is known as Gas Utilities Docket No. 500. 2
Amoco intervened in Docket 500 seeking to flow-through to Amoco customers the increase in gas prices that it would have to pay Lo-Vaca upon entry of a final order in Docket No. 500. On August 7, 1978, the Railroad Commission severed from Docket 500 the question of Amoco's flow-through of costs to its customers. Amoco's flow-through to Big Three was later considered in Gas Utilities Docket No. 1702.
The Railroad Commission order of June 18, 1979 in Docket 1702 provides:
ACCORDINGLY, IT IS ORDERED by the Railroad Commission of Texas that: (1) Amoco shall flow through to and collect from customers, on a pro rata basis as set forth in Appendix A to this order, the increased natural gas costs, if any, to Amoco attributable to a Commission final order in Gas Utilities Docket 500, such flow-through to begin at the time such order may be entered in Gas Utilities Docket 500 ...
Big Three Industries filed a motion for rehearing with the Railroad Commission in Docket 1702. The Railroad Commission overruled the motion and the first administrative appeal was filed in the district court of Travis County on August 20.
On September 4, a final order of the Railroad Commission in Docket 500 allowed Lo-Vaca to flow-through its increased costs to Amoco. The order in Docket 500 provides, inter alia 8. That each customer of Lo-Vaca which purchases natural gas for resale from Lo-Vaca (Lo-Vaca Gas) at the rate established by this Final Order (Resale Customer), or any amended or modified version thereof, is and shall be entitled to, and shall flow-through, charge, collect and retain on a pro rata basis OR OTHER BASIS AS THE COMMISSION MAY IN THE FUTURE DIRECT ... without liability on the part of such Resale Customer to its Secondary Lo-Vaca Customers to refund or in effect to refund (by offset against future collections or retentions or otherwise), TO THE EXTENT AND BY THE METHOD NOW OR HEREINAFTER REQUIRED OR PERMITTED BY COMMISSION ACTION OR CONTRACTUAL PROVISION THE INCREASED COSTS ATTRIBUTABLE TO THIS ORDER. (emphasis in the original.)
On September 4, Big Three was granted a temporary restraining order preventing the flow-through in Docket 1702. On October 4, the Travis County district court temporarily enjoined enforcement of the flow-through in Docket 1702. The Court of Civil Appeals on January 30, 1980, held that the June 18 order in Docket 1702 was not a final order and vacated the temporary injunction. Railroad Commission v. Air Products and Chemicals, Inc., 594 S.W.2d 219 (Tex.Civ.App. Austin 1980, writ ref'd n.r.e.). That court held the order was not final because the order in Docket 1702 was contingent on future action in Docket 500. A final order was entered in Docket 500 after this appeal commenced. The Court of Civil Appeals suggested that Big Three seek a final order in Docket 1702.
After the Court of Civil Appeals' opinion in the first appeal, Big Three filed additional motions for rehearing and motions for the entry of a final order in Docket 1702 in February 1980. The Railroad Commission took no action and the motions were overruled by operation of law. Art. 6252-13a, Section 16(e).
Big Three filed this motion for rehearing in Docket 1702 nine days after the final order in Docket 500. Big Three requested the Railroad Commission to reconsider its action in Docket 1702 because of the final order in Docket 500. The Railroad Commission took no action and the motion for rehearing was overruled by operation of law on October 29, 1979. This second administrative appeal in Docket 1702 is the appeal before this Court.
On February 20, 1980, Big Three was granted a temporary injunction in the second appeal enjoining the flow-through by Amoco of the gas price increases by Lo-Vaca. Amoco and the Railroad Commission again appealed. The Court of Civil Appeals vacated the temporary injunction, holding the June 18, 1979 order in Docket 1702 is not a final order, and that it did not become final by entry of the final order in Docket 500. 601 S.W.2d 186. The court suggested that Big Three's remedy is by mandamus if the Railroad Commission refuses to enter a final order in Docket 1702.
Big Three filed no further motions with the Railroad Commission, but filed a motion for rehearing in the Court of Civil Appeals. Big Three also filed a Motion for Leave to File Petition for Writ of Mandamus to compel the Railroad Commission to enter a final order in Docket 1702. The motions were denied.
Big Three has not attempted an administrative appeal from the final order in Docket 500. The Railroad Commission and Amoco contend that Big Three should be appealing the final order in Docket 500, and not Docket 1702.
The Railroad Commission order severing Docket 1702 from Docket 500 provides:
7. That the issues raised during this proceeding relating to the flow-through of costs incurred pursuant to this order from Lone Star Gas Co. to Charter International Oil Co., Inc., and from AMOCO Gas Company to its customers Champion International, Inc., Big Three Industries, Inc., Air Products and Chemicals, Inc., Mobay Chemical Corp., Gulf Oil Corp., and Upjohn Co. are hereby severed from the disposition of this docket on final order, without prejudice to the position of the Commission, the parties affected, or any other party to this or any other docket or proceeding. (emphasis in the original.)
Amoco and the Railroad Commission contend this order severs only the issue of the pass-through from Amoco to Big Three, and Big Three and Amoco are still parties to Docket 500 because Big Three continued to monitor the Docket 500 proceedings. Amoco and the Railroad Commission also contend Big Three is actually complaining of Docket 500 because it provides for the flow-through to them of increased natural gas costs. Finally, they argue that under existing case law, the proper order to appeal is the last and final order of the administrative agency. Thus, they appear to be arguing that the parties and issues were not severed from Docket 500. 3
In dealing with Docket 500, the Railroad Commission has "severed" various issues and parties into separate dockets. The Railroad Commission has no express rules on severance of issues or dockets. There is nothing in the Administrative Procedure Act governing severance.
In civil cases, either a separate trial of issues or a severance of causes may be ordered. With a separate trial of issues, there is only an interlocutory order determining claims or issues. All claims or issues are finally resolved with the entry of one final judgment. When there is a severance of causes, the lawsuit is divided into two or more independent causes, each of which terminates in a separate, final and enforceable judgment. Kansas University Endowment Association v. King, 162 Tex. 599, 350 S.W.2d 11 (1961).
We hold the Commission intended to sever Docket 1702 from Docket 500 to create separate dockets because:
(1) The final order in Docket 500 was not made contingent upon the resolution of Docket 1702 in the original order of severance, or at any later time.
(2) An Amoco motion for consolidation of Dockets 1702 and 500 was denied by the Railroad Commission. The order stated:
The issues to be dealt with in Docket 1702 involve relationships between Amoco Gas Company and its fixed price customers. The central issues in Gas Utilities Docket 500 which are of importance to Amoco Gas Company deal with the Company's relationship with Lo-Vaca Gathering Company and its affiliates and are not the same issues involved in this proceeding even though in some cases, common fact situations may be involved.
(3) The Railroad Commission prevented Lo-Vaca Gathering Company from intervening in Docket 1702. The Commission stated "no issue involving the relationship between Lo-Vaca Gathering Company and Amoco Gas Company will be considered in Gas Utilities Docket No. 1702."
(4) The Commission has not consolidated Dockets 500 and 1702.
Amoco and the Railroad Commission contend there is no final order to appeal in Docket 1702. They argue the final order in Docket 500 cannot transform the non-final order in Docket 1702 into a final order. They contend the June 18, 1979 order in Docket 1702 always has been and always will be a non-appealable interim order.
There are at least two kinds of non-final administrative orders. The first are interim orders, which by their terms, are to be superseded by a final order. These interim orders are not appealable. City of...
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