Guida v. Public Utilities Commission

• Decision Date: 07 May 1974
• Citation: 166 Conn. 328,348 A.2d 613
• Court: Connecticut Supreme Court
• Parties: Bartholomew F. GUIDA et al. v. PUBLIC UTILITIES COMMISSION et al.

Page 613

348 A.2d 613

166 Conn. 328

Bartholomew F. GUIDA et al. v. PUBLIC UTILITIES COMMISSION et al.

Supreme Court of Connecticut.

May 7, 1974.

Edward F. Becker Killingworth, for appellants (plaintiffs); with him was Thomas F. Keyes, Jr., Corp. Counsel, New Haven, for appellant (named plaintiff).

Frederick D. Neusner, Asst. Atty. Gen., with whom, on the brief, was Robert K. Killian, Atty. Gen., for appellee (named defendant).

J. Read Murphy, Hartford, with whom was Harvey S. Levenson, Hartford, for appellee (defendant The Connecticut Co.).

Before HOUSE, C.J., and SHAPIRO, LOISELLE, MacDONALD and BOGDANSK, JJ.

LOISELLE, Associate Justice.

The Connecticut Company, a motor bus company operating in the various parts of the state, petitioned the public utilities commission, hereinafter called the commission, in December, 1971, to increase its fares and to decrease its service in the Hartford and New Haven areas. The petition to amend its rate schedule was filed under General Statutes § 16-19 and the petition to decrease its services was filed under § 16-309. The petitions were docketed separately but were reviewed by the commission in a single combined hearing during the early part of 1972. During course of the hearings, the plaintiffs, Mayor Bartholomew F. Guida and the city of New Haven, petitioned the commission to reverse a previous order of March 31, 1971, which approved the transfer of the certificate authorizing the operation of a motor bus line and the utility-related assets of The Connecticut Company to Transit, Inc. ¹ The petition of the plaintiffs was denied on April 28, 1972. The commission made its order and finding on the two petitions of The Connecticut Company on May 25, 1972. The plaintiffs appealed from the May 25, 1972 order and finding to the Court of Common Pleas on June 19, 1972.

The Connecticut Company claims that the Court of Common Pleas lacked jurisdiction to entertain this appeal because more than thirty days elapsed between the denial of the plaintiffs' petition and the date the appeal was filed. § 16-35. ² Whether the trial court had jurisdiction must first be determined although the issue was not raised below. State ex rel. Kelman v. Schaffer, 161 Conn. 522, 527, 290 A.2d 327. While it would appear at first blush that The Connecticut Company's claim is well taken, an examination of the unorthodox procedures taken by the plaintiffs and the commission leads to the conclusion that the court did have jurisdiction to decide the issue.

The motion to rescind and reverse was submitted as part of the proceedings on the two petitions for the increase of fares and the decrease of services. By accepting and considering the petition with the knowledge and in the presence of The Connecticut Company, any procedural infirmities in the presentation of the motion were waived by the commission. The hearing on the plaintiffs' motion became a part of the hearing on the two petitions. The motion was not decided on the basis of a separate procedure but as a part of the proceedings on the petitions of The Connecticut Company. Although a separate document denying the plaintiffs' petition was issued by the commission on April 28, 1972, it was headed by the docket numbers and titles of the two petitions filed by The Connecticut Company. In addition, the reasons underlying the denial of the plaintiffs' petition received extensive discussion in the commission's decision of May 25, 1972, on the two other petitions. Both the plaintiffs and the commission considered the motion and the denial of the motion to be parts of the hearing on The Connecticut Company's two petitions. The appeal from the finding and order relating to the two petitions rather than from the denial itself was proper, and the Court of Common Pleas had jurisdiction to review the action of the commission.

On the other hand, although the procedures followed in the motion to rescind and reverse were unorthodox, The Connecticut Company acquiesced in any procedural error of the commission and cannot now complain. See Norton v. Shore Line Electric Ry. Co., 84 Conn. 24, 39, 78 A. 587.

The appeal from the Court of Common Pleas was confined to the ruling of the court upholding the commission's denial of the plaintiff's petition for revocation of the commission's order of March 31, 1971. The power of the commission to reverse its own action derives from § 16-9 of the General Statutes which specifies that the 'commission may, at any time, for cause shown . . . rescind, reverse or alter any decision, order or authorization by it made.' The plaintiffs' basic argument at trial was that the petitions of the company to reduce service and increase rates, less than one month after the approval of the transfer, demonstrated sufficient cause for the commission to reverse itself. In this appeal, they apparently rely on the two legal principles argued in their brief to demonstrate that the trial court erred in upholding the commission's determination. The function of the trial court was to determine on the basis of the record whether the refusal of the commission to rescind the transfer permit under § 16-9 was illegal, arbitrary or an abuse of discretion. General Statutes § 16-37; Nw Haven v. Public Utilities Commission, 165 Conn. 687, 705, 343 A.2d 563; Anthony Augliera, Inc. v. Loughlin, 149 Conn. 478, 482, 181 A.2d 596; Brook Ledge, Inc. v. Public Utilities Commission, 145 Conn. 617, 619, 145 A.2d 590.

The evidence before the commission on the plaintiffs' petition was as follows: On March 16, 1971, the commission received a letter from the attorney for The Connecticut Company requesting the transfer of its Certificate of Public Convenience and Necessity for Motor Bus Operation, No. 200, to a wholly owned subsidiary company named Transit, Inc. Accompanying the letter were the agreement between The Connecticut Comapny and Transit, Inc., a schedule of assets to be transferred and liabilities to be assumed, and balance sheets showing the assets and liabilities of The Connecticut Company and Transit, Inc., immediately before and after the transfer. The cover letter explained that the purpose of the transfer was to separate the transit bus business from the company's nontransit business and investments and to clarify the financial position of the transit operation if federal subsidies were to be obtained or if a government agency were to assume operation of the transit line. Pursuant to its authority under § 16-309, ³ the commission approved the transfer in its order of March 31, 1971. During the subsequent rate and service hearings, the president and chairman of the board of The Connecticut Company testified that when he purchased the company in 1964 it was badly in need of replacement of equipment but did not have the financial ability to purchase such equipment. At that time, he and members of his family pledged certain stock in other companies, valued at approximately $6,000,000, for the express purpose of establishing credit so that The Connecticut Company could acquire new equipment.

In its order affirming the transfer, the commission analyzed the evidence produced at the hearing and found that the investments of $6,069,512 referred to by the president of the company were nontransit or nonutility investments. The order further stated that the commission's decision was not predicated on the company's balance sheet but was based 'on our analysis of the ability of the revenues being realized under the current schedule of fares to meet current operating expenses.' ⁴ The arguments of the plaintiffs boil down to two propositions, both of which seek to attack the segregation of the stock from the operating transit lines. Their first claim is that the court erred in upholding the refusal of the commission to rescind the transfer order in that...