Colorado Office of Consumer Counsel v. Public Utilities Com'n of State of Colo., 86SA53

• Decision Date: 14 March 1988
• Docket Number: No. 86SA53,86SA53
• Citation: 752 P.2d 1049
• Parties: COLORADO OFFICE OF CONSUMER COUNSEL, Petitioner-Appellant and Cross-Appellee, v. PUBLIC UTILITIES COMMISSION OF the STATE OF COLORADO, Edythe S. Miller, Andra Schmidt, and Ronald L. Lehr, as Commissioners thereof, and Mountain States Telephone and Telegraph Company, Respondents-Appellees, and AT & T Communications of the Mountain States, Inc., and Colorado Municipal League, Intervenors-Appellees. COLORADO MUNICIPAL LEAGUE, Plaintiff-Appellee and Cross-Appellant, v. PUBLIC UTILITIES COMMISSION OF the STATE OF COLORADO, Edythe S. Miller, Andra Schmidt and Ronald L. Lehr, as Commissioners thereof, and Mountain States Telephone and Telegraph Company, Defendants-Appellees, and AT & T Communications of the Mountain States, Inc., Intervenor, and Colorado Office of Consumer Counsel, Intervenor-Appellant.
• Court: Colorado Supreme Court

Page 1049

752 P.2d 1049

COLORADO OFFICE OF CONSUMER COUNSEL, Petitioner-Appellant and Cross-Appellee, v. PUBLIC UTILITIES COMMISSION OF the STATE OF COLORADO, Edythe

S. Miller, Andra Schmidt, and Ronald L. Lehr, as

Commissioners thereof, and Mountain States Telephone and

Telegraph Company, Respondents-Appellees,

and

AT & T Communications of the Mountain States, Inc., and

Colorado Municipal League, Intervenors-Appellees.

COLORADO MUNICIPAL LEAGUE, Plaintiff-Appellee and Cross-Appellant, v. PUBLIC UTILITIES COMMISSION OF the STATE OF COLORADO, Edythe

S. Miller, Andra Schmidt and Ronald L. Lehr, as

Commissioners thereof, and Mountain States Telephone and

Telegraph Company, Defendants-Appellees,

and

AT & T Communications of the Mountain States, Inc., Intervenor,

and

Colorado Office of Consumer Counsel, Intervenor-Appellant.

No. 86SA53.

Supreme Court of Colorado En Banc.

March 14, 1988.

Anthony Marquez, Denver, for Colorado Office of Consumer Counsel.

Gorsuch, Kirgis, Campbell, Walker and Grover, Dudley P. Spiller, Jr., Joseph B. Wilson, Denver, for Colorado Mun. League.

Duane Woodard, Atty. Gen., Charles B. Howe, Chief Deputy Atty. Gen., Richard H. Forman, Sol. Gen., Mark A. Davidson, Eugene C. Cavaliere, Asst. Attys. Gen., Denver, for Public Utilities Comn.

Eiberger, Stacy & Smith, Steven H. Denman, Denver, for Mountain States Tel. and Tel. Co.

VOLLACK, Justice.

The Colorado Municipal League (League) and the Office of Consumer Counsel (Office) appeal the order of the Denver District Court affirming the decisions of the Public Utilities Commission (Commission) to permit tariff increases requested by Mountain States Telephone and Telegraph Co. (Mountain Bell) to go into effect. The League and the Office claim that the Commission abused its discretion in failing to hold formal hearings, in permitting the tariffs to become effective on less than thirty days notice, and in failing to consider test year data. ¹ The Office makes the additional claim that the district court improperly dismissed its complaint for failure to exhaust administrative remedies. We affirm the judgment of the district court.

I.

This appeal traces it origins to Advice Letter 1980 filed by Mountain Bell on December 7, 1984. Advice Letter 1980 sought to implement tariffs designed to produce annual revenue increases of approximately $19 million. The tariffs were sought to offset higher costs attributable to its implementation of Equal Life Group (ELG) depreciation methods and to its shortening of the amortization period of customer premises wiring (CPW) from seven to three years. The proposed effective date of Advice Letter 1980 was March 1, 1985.

Rather than holding a formal hearing, the Commission chose to conduct two days of informal meetings and notified all interested parties to that effect. Informal meetings were attended by Mountain Bell, the Office, the League, AT & T Communications of the Mountain States, Inc. (ATTCOM) and the Department of Defense on February 5-6, 1985. At the conclusion of these meetings, Mountain Bell modified its proposals by lowering the proposed tariffs to reflect concerns of the Office and the League. Mountain Bell withdrew Advice Letter 1980 and submitted the modified proposals (ELG tariff and CPW tariff) to the Commission. Both the League and the Office filed protests to the modified proposals and requested the Commission to hold a formal hearing on the matter.

On February 21, 1985, the Commission permitted the modified proposals to go into effect without a hearing. The ELG tariff and the CPW tariff were permitted to go into effect on March 1, which was less than the thirty days notice required by section 40-3-104(1)(a), 17 C.R.S. (1984).

On February 28, the League filed an application for "rehearing, reargument, or reconsideration" (rehearing) of the February 21 decisions pursuant to section 40-6-114, 17 C.R.S. (1984). On March 12, the Commission granted the League's application for rehearing of the February 21 decisions and issued two more decisions, which explained and modified its decisions of February 21. On March 29, the League filed an application for rehearing of the March 12 decisions, but that application was denied. Having exhausted its administrative remedies, the League filed a complaint in Denver District Court challenging the March 12 decisions.

On March 13, the Office filed an application for rehearing of the February 21 decisions. That request was denied. The Office did not file an application for rehearing of the March 12 decisions. Instead, it chose to challenge the March 12 decisions by filing a complaint in Denver District Court.

The district court consolidated the claims of the Office and the League. The court eventually dismissed the Office's claim for failure to exhaust administrative remedies and affirmed the Commission's decisions with respect to the League. Both the League and the Office appeal to this court pursuant to section 40-6-115(5), 17 C.R.S. (1984).

II.

The district court held that it lacked jurisdiction to hear the Office's claims because the Office failed to apply for rehearing of the March 12 decisions. The Office claims that its failure to apply for rehearing of the March 12 decisions does not preclude it from seeking judicial review. In support of this position, the Office argues that it made a timely application for rehearing of the February 21 decisions, that the March 12 decisions were not substantial modifications of the February 21 decisions, and that it raised no argument to the district court other than those raised in its application for rehearing of the February 21 decisions. We conclude that failure to apply for rehearing of the March 12 decisions precludes the Office from seeking judicial review.

The Office and the Commission agree that section 40-6-114, 17 C.R.S. (1984) is the appropriate statute to consider in determining whether the Office can obtain judicial review of the March 12 decisions. The Office's interpretation of section 40-6-114, however, differs from that of the Commission. Our primary role is to construe statutes so as to effectuate the intent of the General Assembly. In ascertaining that intent, words and phrases should be given their plain and obvious meaning. Englebrecht v. Hartford Accident & Indem. Co., 680 P.2d 231, 233 (Colo.1984).

A plain reading of subsections (1), (3) and (4) to section 40-6-114 reveals that the Office's failure to apply for rehearing of the March 12 decisions is a defect fatal to its petition for judicial review. Subsection (1) permits a dissatisfied party to dispute the Commission's decision by filing an application for rehearing within twenty days thereafter. Subsection (3) requires ² the party to file a second application for rehearing of a decision reversing, changing or modifying the original decision within the time specified in subsection (1). Subsection (4) permits the party whose application for rehearing is denied to enforce, suspend, modify or set aside the decision "in a district court of the state of Colorado, as set forth in this article, but not otherwise." § 40-6-114 (emphasis added). The clear import of these subsections is that failure to apply for rehearing of the March 12 decisions modifying the February 21 decisions precludes the Office from setting aside the March 12 decisions in district court. See Public Util. Comm'n v. Northwest Water Corp., 168 Colo. 154, 167, 451 P.2d 266, 272 (1969); Bender, Prosecuting an Appeal from a Decision of the Colorado Public Utilities Commission, 16 Colo.Law. 2163, 2164 (1987).

Contrary to the claims of the Office, section 40-6-114(3) does not require a subsequent decision to be a substantial modification of the original decision. Section 40-6-114(3) provides:

If after rehearing, reargument, or reconsideration of a decision of the commission it appears that the original decision is in any respect unjust or unwarranted, the commission may reverse, change, or modify the same accordingly. Any decision made after rehearing, reargument, or reconsideration, reversing, changing, or modifying the original decision, shall be subject to the same provisions with respect to rehearing, reargument, or reconsideration as an original decision....

17 C.R.S. (1984). The Commission modified its February 21 decisions by explaining more fully in the March 12 decisions its reasons for the new tariffs. ³ These modifications could have been challenged by the Office simply by filing a second application for rehearing. All of the Commission's decisions denying rehearing of the February 21 and March 12 decisions included reminders to the parties of the twenty day requirement of section 40-6-114(1). The League filed a second application for rehearing and exhausted its administrative remedies, while the Office did not. Failure to exhaust administrative remedies precludes a party from seeking judicial review of an administrative decision. Colorado Mun. League v. Public Util. Comm'n, 197 Colo. 106, 118, 591 P.2d 577, 585 (1979); Public Util. Comm'n v. Poudre Valley Rural Elec. Ass'n, 173 Colo. 364, 480 P.2d 106 (1970); Denver-Laramie-Walden Truck Line, Inc. v. Denver-Ft. Collins Freight Serv., Inc., 156 Colo. 366, 399 P.2d 242 (1965).

The district court properly dismissed the Office's claims for failure to exhaust administrative remedies.

III.

The League contends that the Commission abused its discretion by failing to hold a formal hearing when it permitted the tariffs to go into effect. It argues that a reading of section 40-6-109(5) together with Rule 17 of the Commission's Rules of Practice and Procedure requires the Commission to hold a formal hearing whenever a timely protest is filed. The Commission argues that neither section 40-6-109(5) nor Rule 17 is apposite, and that the appropriate statutory authorities, section 40-6-111(1)(a) and Rule 18 of the Commission's Rules of Practice and Procedure, make the decision to hold a hearing discretionary. We conclude...