General Tel. Co. of Pa. v. Pennsylvania Public Utility Commission
| Decision Date | 15 June 1960 |
| Citation | 161 A.2d 906,192 Pa.Super. 563 |
| Parties | GENERAL TELEPHONE COMPANY OF PENNSYLVANIA, Appellant, v. PENNSYLVANIA PUBLIC UTILITY COMMISSION and Wattsburg Telephone Corporation, Intervening Appellee. |
| Court | Pennsylvania Superior Court |
John C. Kelley, Hull, Leiby & Metzger Harrisburg, Frank B. Quinn, Erie, for appellant.
Miles Warner, Asst. Counsel, Philadelphia, Thomas M. Kerrigan Counsel, Harrisburg, for Pennsylvania Public Utility Commission.
W Russel Hoerner, Harrisburg, for appellee.
Rhoads, Sinon & Reader, Harrisburg, for Wattsburg Telephone Corp., intervening appellee.
Before RHODES, P. J., and GUNTHER, WRIGHT, WOODSIDE, ERVIN, WATKINS and MONTGOMERY, JJ.
We are here concerned with an appeal by General Telephone Company of Pennsylvania, hereinafter referred to as General, from those portions of an order of the Pennsylvania Public Utility Commission, dated June 22, 1959, which direct (1) that General file tariff supplements excluding any and all portions of the certificated territory of Wattsburg Telephone Corporation, hereinafter referred to as Wattsburg, and (2) that overlapping conditions now existing shall be restricted to geographic location and contract life. Wattsburg was granted permission to become an intervening appellee. It will be necessary to set forth the factual background in considerable detail.
Some fifty-five years ago a number of groups of farmers in Erie County formed partnerships to build, maintain, and operate their own telephone facilities along country roads converging upon the Borough of Wattsburg. About the year 1920 the Wattsburg Telephone Company was organized, built an exchange, coordinated the facilities of the smaller groups, and began to furnish telephone service. Commission records in the form of tariffs, annual reports, and assessment payments indicate that a de facto utility service was provided until January 31, 1950. As of that date the Wattsburg Telephone Cooperative Association, hereinafter referred to as Association, was organized under the Act of June 7, 1887, P.L. 365, 14 P.S. § 1 et seq. The facilities of the unincorporated Wattsburg Telephone Company were acquired by Association and telephone service has continued until the present time. While Association was not subject to regulation under the Public Utility Law, [1] there is no question, as found by the Commission, that it 'succeeded to the interests of Wattsburg Telephone Company by the continuous rendition of service since January 31, 1950, to all persons in its territory desiring same'.
General was formerly known as the Mutual Telephone Company, which had been incorporated on February 1, 1897. By Commission order dated January 17, 1921, its territory was enlarged to include all of the counties of Erie, Warren, and Crawford. On May 14, 1956, in Wattsburg Telephone Cooperative Association v. General Telephone Company of Pennsylvania, 34 Pa.P.U.C. 167, the Commission dismissed Association's complaint against General, wherein Association sought to restrain General from extending its telephone service into the area within which Association claimed it had exclusive authority by virtue of a prior territorial agreement entered into between Association and General. The Commission's order 'rested on the explicit premise that the granting of the relief sought would necessarily have involved the delegation to a nonutility of a utility's charter obligation to service, thereby removing the service area under dispute from our regulatory jurisdiction'. On December 28, 1956, the order of the Commission was affirmed by this court on the ground that Association was not a public utility, and that the agreement relied on in that complaint proceeding was not enforceable under the Public Utility Law. See Wattsburg Telephone Cooperative Association v. Pa. P. U. C., 182 Pa.Super. 594, 128 A.2d 160.
The record at Application Docket No. 85902 discloses in Folder 1 the application of Wattsburg for letters patent filed August 22, 1958, and the application of Wattsburg for approval of its incorporation, organization, and creation filed October 24, 1958; and in Folder 2 the application of Wattsburg for approval of the beginning of the exercise of the right to furnish telephone service in designated portions of Erie County, filed October 24, 1958. [2] General entered protests and was given permission to intervene. Similar permission was given to four individuals who opposed the granting of the applications. Hearings were held on December 29, 1958 and on January 26 and 27, 1959. In these hearings General fully participated by counsel, cross-examining witnesses for the applicant and presenting evidence on its own behalf. Wattsburg introduced maps designating the service area for which Commission approval was requested. Within this proposed service area were located 432 customers of Association. Three of Association's customers were located without and four of General's recent customers were located within the proposed service area, all seven of whom were near the proposed territorial boundary line. Wattsburg's testimony indicates that Association's members, wishing to continue the present service arrangements, elected to exercise their legal right to incorporate as a public utility. This action was prompted by the recognition that an expansion and modernization program is warranted. As a recognized public utility, and with a certificated service area under Commission jurisdiction, Wattsburg will be enabled to obtain financing from the Rural Electrification Association. [3]
General's protest was based on the ground that it possessed charter rights to serve the area in question. The finding of the Commission was that, with the exception of the four subscribers hereinbefore mentioned, General did not render and never had rendered service within the area served by Association. The Commission concluded that, in view of the continuous service rendered by Association and its predecessor, and in the public interest, General was not entitled to pre-emption. In the words of the Commission: 'We must thus reject General's contention that Harmony Electric Company v. Public Service Commission, supra, 78 Pa.Super.Ct. 271, 1922, is controlling. That case holds that the operating rights of a public utility corporation formed prior to January 1, 1914 are co-extensive with the rights expressed in its charter, and that the exercise of those rights may not be curtailed by Commission action. However, the Supreme Court's decision in Fogelsville and Trexlertown Electric Company v. Pennsylvania Power and Light Company, 271 Pa. 237, 114 A. 822, 1921, substantially qualifies the Harmony doctrine by holding that charter rights acquired prior to January 1, 1914, can be lost or forfeited by nonexercise, and that in such event it is for the Commission, in the exercise of its regulatory discretion, to determine which of two competing utilities should be permitted to serve. The qualification on the Harmony rule was again enunciated by the Supreme Court when it affirmed the Superior Court's decision in that very case, 275 Pa. 542, 119 A. 712, and stated that the rule was applicable to 'service within unabandoned chartered territory".
Following the entry of the order of the Commission on June 22, 1959, General filed a petition for rehearing requesting in the alternative that the Commission modify its order by excluding therefrom 'any finding or orders defining or limiting the corporate or franchise rights of petitioner to serve the disputed territory'. To this petition for rehearing, Wattsburg filed an answer. On October 6, 1959, the Commission denied the petition. This appeal by General followed.
The issue before us is actually a very narrow one. General does not here question that portion of the order of the Commission approving the incorporation of Wattsburg or the beginning by it of the exercise of its rights. The appeal is limited to those portions of the order which in effect restrict the territory covered by General's duly filed tariffs and require General to reduce its service area. Appellant contends that the Commission order goes beyond the issues in the instant proceeding, and was 'made without notice and hearing in violation of the provisions of the Public Utility Law, the Pennsylvania Constitution and the Constitution of the United States'. It should be noted that appellant does not challenge the Commission's finding that service in the disputed area should be rendered by Wattsburg. Indeed, appellant concedes that, under Section...
To continue reading
Request your trial