Bontrager v. LA PLATA ELEC. ASS'N INC.

• Decision Date: 27 February 2003
• Docket Number: No. 02CA0234.,02CA0234.
• Citation: 68 P.3d 555
• Parties: William D. BONTRAGER, Plaintiff-Appellant, v. LA PLATA ELECTRIC ASSOCIATION INC., Defendant-Appellee.
• Court: Colorado Court of Appeals

68 P.3d 555

William D. BONTRAGER, Plaintiff-Appellant, v. LA PLATA ELECTRIC ASSOCIATION INC., Defendant-Appellee.

No. 02CA0234.

Colorado Court of Appeals, Div. III.

February 27, 2003.

William D. Bontrager, Pro Se.

Maynes, Bradford, Shipps & Sheftel, LLP, Thomas H. Shipps, John Barlow Spear, Laranne Arbaugh, Durango, Colorado, for Defendant-Appellee.

Kent L. Singer, Denver, Colorado, for Amici Curiae Colorado Rural Electric Association and Tri-State Generation and Transmission Association, Inc.

Opinion by Judge WEBB.

This case challenges a nonprofit cooperative electric association's investment of member capital in for-profit, nonelectric subsidiaries. Plaintiff, William D. Bontrager, appeals the trial court's judgment in favor of defendant, La Plata Electric Association Inc. (LPEA). Contrary to plaintiff's contentions, we conclude that LPEA acted within its statutory authority and governing documents, and therefore we affirm.

LPEA is a nonprofit cooperative electric association that was formed under § 41-16-210, et seq., C.R.S.1935, and is now subject to § 7-55-101, et seq., C.R.S.2002 (article 55). LPEA was a public utility subject to the jurisdiction of the Public Utilities Commission (PUC). Section 40-1-103(2)(a), C.R.S. 2002. In 1993, LPEA obtained an exemption from PUC regulation under the Cooperative Electric Associations Act, § 40-9.5-101, et seq., C.R.S.2002 (CEA Act).

In 1995, LPEA's members voted to amend the purpose section of its articles of incorporation to allow LPEA "to form one or more subsidiary business organizations to provide such other services as may be permitted by law for the benefit of the cooperative, its members or non-members." Thereafter, LPEA formed and invested member capital in two for-profit, nonelectric subsidiaries, one of which took bankruptcy.

Plaintiff, an LPEA member, commenced this action for injunctive and declaratory relief challenging LPEA's formation of and investment in the subsidiaries on multiple grounds. As relevant here, plaintiff moved for partial summary judgment on his argument that LPEA exceeded its statutory authority, articles of incorporation, and bylaws. LPEA filed a cross-motion for partial summary judgment. The parties agreed the trial court should first resolve these issues.

The trial court denied plaintiff's summary judgment motion and granted partial summary judgment for LPEA. The court entered a judgment declaring that LPEA's formation of and investment in the subsidiaries was not prohibited by the governing statutes, its articles of incorporation, or its bylaws. The parties then dismissed the remainder of the case, and plaintiff now appeals.

When, as here, the parties do not raise factual disputes, issues of statutory interpretation are particularly appropriate for resolution on summary judgment. See Oklahoma ex rel. Dep't of Human Servs. v. Weinberger, 741 F.2d 290 (10th Cir.1983)

.

I.

Raising questions of first impression in Colorado, plaintiff argues the governing statutes restrict LPEA to providing electric and related services and prohibit it from owning and investing in for-profit, nonelectric subsidiaries. We disagree.

Statutory interpretation is a question of law that we review de novo. Colo. State Bd. of Accountancy v. Paroske, 39 P.3d 1283 (Colo.App.2001).

When interpreting a statute, our primary responsibility is to determine the intent of the General Assembly. People v. Cooper, 27 P.3d 348 (Colo.2001). We begin with the statute's language, which we afford its ordinary and common meaning. We construe statutes as a whole, give effect to every word, and resist forced or strained constructions. Bd. of County Comm'rs v. Vail Assocs., Inc., 19 P.3d 1263 (Colo.2001).

We presume the General Assembly intended the entire statute to have effect and also intended a just and reasonable result. Section 2-4-201(1)(b)-(c), C.R.S.2002; People v. Luther, 58 P.3d 1013 (Colo.2002); Climax Molybdenum Co. v. Walter, 812 P.2d 1168 (Colo.1991).

If separate clauses within a statute can be reconciled using one interpretation but would conflict under another, we adopt the interpretation allowing for consistency. People v. Dist. Court, 713 P.2d 918 (Colo. 1986). When multiple statutes or multiple statutory provisions apply to the subject matter, we examine all applicable provisions to ascertain legislative intent. R.E.N. v. City of Colorado Springs, 823 P.2d 1359 (Colo.1992). We favor an interpretation that gives consistent and harmonious effect to all provisions. Charnes v. Boom, 766 P.2d 665 (Colo.1988).

We look to legislative history and other extrinsic factors only if the statute is ambiguous or portions of the statute may conflict. People v. Cooper, supra.

A.

We first reject plaintiff's contention that the CEA Act and article 55 limit LPEA to providing electric and related services.

Section 40-9.5-101 of the CEA Act allows a cooperative electric association, regulated by an elected governing body, to exempt itself from PUC regulation by an affirmative vote of its members. Under § 40-9.5-107, an exempt cooperative electric association must continue to perform various "duties" connected with its provision of electric services. Among other duties, the statute requires the following:

(1) Cooperative electric associations shall provide reasonably continuous and adequate electric utility service to all members and consumers....

(2) Cooperative electric associations shall provide and maintain reasonably adequate facilities for the provision of electric utility service within their certificated service areas.

(3) All cooperative electric associations shall cooperate with each other and with other electric utilities in avoiding unnecessary construction of facilities and cooperate in the joint use of facilities for generation, transmission, and distribution of electric energy.

(4) Cooperative electric associations shall construct and maintain their facilities in a careful and safe fashion so as to minimize hazards to either persons or property.

Plaintiff contends that, had LPEA remained subject to PUC regulation, it could have invested in for-profit, nonelectric subsidiaries only with PUC approval. Thus, according to plaintiff, § 40-9.5-107 prohibits these investments because the section establishes only duties relating to electric services, and no other statute grants broader powers. We are not persuaded.

"Powers" and "duties" have different meanings: duties are obligations that must be fulfilled; powers are rights that need not be exercised. Black's Law Dictionary 521, 1189 (7th ed.1999); see 2A Norman J. Singer, Sutherland on Statutory Construction § 47.27 (6th ed.2000)(use of dictionary appropriate to interpret undefined statutory terms).

While statutory identification of a duty may imply the power necessary to perform that duty, we cannot imply a limitation on powers extraneous to the duties listed. Cf. Frontier Ditch Co. v. Southeastern Colo. Water Conservancy Dist., 761 P.2d 1117 (Colo.1988)

(state's duty to protect the right of appropriators did not deprive it of the power to enter into interstate compacts and delegate this duty to a sister state).

Consideration of the entire statutory scheme also weighs against plaintiff's interpretation of § 40-9.5-107. Section 40-9.5-112 states: "Except as otherwise provided in [the CEA Act], the provisions of article 55 of title 7, C.R.S., shall apply to cooperative electric associations." The parties agree that LPEA is subject to article 55.

Section 7-55-102(1) provides, in relevant part, that a Colorado cooperative "may be associated and incorporated for the cooperative transaction of any lawful business, except banking." Section 7-55-108 states: "The powers enumerated in section 7-55-107 shall vest in every cooperative corporation in this state except those organized under or subject to article 56 of this title, although such powers may not be specified in its charter or in its articles of incorporation." Section 7-55-107 lists the "powers" of cooperative associations, including the power to "hold such real and personal property as may be necessary for the legitimate business of the corporation." Section 7-55-107(1)(d). Thus, the General Assembly recognized the difference between these terms by addressing "duties" in § 40-9.5-107 and "powers" in § 7-55-107.

Section 7-55-116 incorporates the for-profit and nonprofit sections of the Colorado Corporation Code "and all powers and rights thereunder ... except where such provisions are in conflict with or inconsistent with the express provision of this article." Because a cooperative association "shall not be carried on for profit," § 7-55-101(1)(d), we focus on the purposes and powers of nonprofit corporations provided in § 7-123-101, et seq., C.R.S.2002.

Nonprofit corporations likewise may engage "in any lawful business." Section 7-123-101(1). They are empowered to "purchase, receive, subscribe for, and otherwise acquire shares and other interests in, and obligations of, any other entity." Section 7-123-102(1)(f) (emphasis supplied).

Here, the 1995 amendment to LPEA's articles of incorporation broadened its purposes to include forming entities that provide "other services." A cooperative association enjoys the power to amend its articles, § 7-55-109, as does a nonprofit corporation, § 7-130-101(1), C.R.S.2002. And forming other entities constitutes a "lawful business." Sections 7-55-102(1), 7-123-101(1).

Moreover, once LPEA's purpose was broadened by the amendment, its ownership of nonelectric subsidiaries would constitute holding personal property necessary for the association's legitimate business, § 7-55-107(1)(d), and acquisition of shares in "any other entity," § 7-123-102(1)(f).

Hence, we cannot conclude the General Assembly intended to limit cooperative electric associations to providing electric service.

Nevertheless, plaintiff argues we should construe "any lawful business" in § 7-55-102(1) narrowly for several reasons, none...