Huron Portland Cement Co. v. Michigan Public Service Com'n

• Decision Date: 04 March 1958
• Docket Number: No. 43,43
• Citation: 351 Mich. 255,88 N.W.2d 492
• Parties: , 23 P.U.R.3d 117 HURON PORTLAND CEMENT COMPANY, Plaintiff-Appellant, v. MICHIGAN PUBLIC SERVICE COMMISSION, and Consumers Power Company, Defendants-Appellees.
• Court: Michigan Supreme Court

Page 492

88 N.W.2d 492

351 Mich. 255, 23 P.U.R.3d 117

HURON PORTLAND CEMENT COMPANY, Plaintiff-Appellant, v. MICHIGAN PUBLIC SERVICE COMMISSION, and Consumers Power Company, Defendants-Appellees.

No. 43.

Supreme Court of Michigan.

March 4, 1958.

Snyder & Loomis, Lansing, for plaintiff and appellant.

Thomas M. Kavanagh, Atty. Gen., Samuel J. Torina, Solicitor General, Lansing, Robert A. Derengoski, John E. Tormey, Asst. Attys, Gen., for appellee Public Service Commission.

A. H. Aymond, Jr., H. P. Graves, Jackson, for defendant and appellee Consumers Power Co.

John R. Watkins, East Tawas, Robert C. Winter, Wilhelmina Boersma, Detroit, of counsel, for Alpena Power Co., amicus curiae.

Before the Entire Bench.

SMITH, Justice.

The problem presented concerns the furnishing of electric service to the appellant. This is an appeal in the nature of certiorari from an order of the Michigan public service commission dated January 4, 1957, 'but only insofar as it denies in paragraph 4 of the order section thereof the petition of Huron Portland Cement Company for direct electric service from Consumers Power Company.' Paragraph 4, above referred to, states as follows:

'4. The petition of Huron Portland Cement Company requesting that this Commission order Consumers Power Company to render direct electric service to it from its 140KV transmission line running from Mio, Michigan to the plant of the Presque Isle Corporation, is hereby denied.'

It is the position of the commission, in respect of such denial, that 'the provisions of P.A.1929, No. 69, are controlling in this matter and under section 2 of said act it is necessary that Consumers Power Company obtain from this commission a certificate that public convenience and necessity will require the rendering of this service.'

It is the claim of appellant, on the other hand, in its application for leave to appeal, that:

'B. The Michigan Public Service Commission erred in determining that it lacked statutory authority to order Consumers Power Company to serve directly from its transmission line the Huron Portland Cement Company under the facts and circumstances contained in the record:

'(1) By giving no consideration to the powers vested in it by the act creating the commission which is Act 3, Public Acts of 1939 (MSA § 22.13, 1955 Cum.Supp.), which grants to the Michigan Public Service Commission broad discretionary powers to regulate electric light and power companies;

'(2) By giving no consideration to the powers vested in it by the provisions of Act 106, Public Acts of 1909 (MSA § 22.156) which is commonly referred to as the 'Transmission Act' which provides in section 6 that the commission shall have power to order service to be rendered from a transmission line in any case in which it will be reasonable for such service to be ordered.

'C. The Michigan Public Service Commission erred in determining that the provisions of Act 69, Public Acts of 1929 (MSA § 22.141) were exclusively controlling in this case.'

Upon the above record, in part, and upon the representation to us 'that time was of the essence in this case,' we granted application for leave to appeal. Appellant raises 2 questions and 2 only:

'(1) Did the Michigan Public Service Commission lack statutory authority to order direct electric service from Consumers Power Company to appellant Huron Portland Cement Company?'

And----

'(2) Was it necessary that Consumers Power Company petition the Michigan Public Service Commission for the granting of a certificate of convenience and necessity to render direct electric service to appellant before the Commission could order Consumers Power Company to render direct electric service to appellant?'

We will confine our summation of the facts to the issues thus presented on this appeal. By way of background, however, we should point out that the commission had before it 3 matters involving electric service in and near Alpena, Michigan. These matters were to some degree interrelated and the commission hence issued a single opinion and order thereon. Huron appealed, as above noted, from that part of the opinion and order which denied its petition for direct electric service from Consumers.

The situation presented to the commission was this: Appellant Huron Portland Cement Company (Huron), a Michigan corporation, engaged in the business of manufacturing and selling cement, conducted a portion of its operations in the city of alpena. It was in need of large additional amounts of electric power. The local electric power company is the Alpena Power Company (Alpena Power), a Michigan corporation with a service area comprising the city of Alpena and certain nearby areas. ¹ But Alpena Power was not the only electric utility company in the general area. Consumers Power Company (Consumers) furnished large industrial power service within Alpena Power's service area to the Presque Isle Corporation pursuant to a contract therefor which had been approved by commission order. This order also granted Consumers a certificate of convenience and necessity to construct, maintain, and operate a 140KV transmission line from Mio, Michigan to the plant of the Presque Isle Corporation. Such transmission line does not enter or pass through the city of Alpena.

Huron wished to purchase its power requirements directly from Consumers. Accordingly it petitioned the commission to order Consumers to supply the service. This the commission, by order dated January 4, 1957, refused to do. Other necessary facts will appear in our discussion of the issues of law presented.

The appellant asserts (which the commission denies) that the commission has authority to order Consumers to render this service. The question posed is a broad one, going to the very roots of private enterprise. This is not a case where a utility, already servicing a city, arbitrarily refuses to take on a new (or expanded) burden, for Consumers has never supplied electricity to either the city of Alpena or the Alpena area generally. Furthermore, it has stated without ambiguity that it does not profess to service the Alpena area. No other conclusion can be reached from that portion of the record which purports to state the position of Consumers Power Company in this matter:

'Now, if the Commission please, these applications place Consumers Power Company in a difficult position, because if these industries were located in our service area, we would be pleased to serve these customers with their requirements for electric energy. We well appreciate their desire for electric service on the most advantageous terms to them.

'We are also mindful of the interests of the Presque Isle Corporation, which is a valued customer of Consumers Power Company, and which paid for the cost of the construction of the transmission line which enables Consumers Power Company to bring its electric energy into this area.

'The Presque Isle Corporation is entitled to refunds of such costs of construction on the basis of revenues which we may derive from sales to customers served from that line. We therefore believe that it would be inappropriate for us to take any action which would tend to reduce the refunds which the Presque Isle Corporation might otherwise receive.

'Now, on the other hand, the Alpena Power Company is presently rendering service in the area in which these industries are located. Alpena Power Company also is a valued customer of ours, or soon will be. Moreover, the Alpena Power Company was of great assistance to Consumers Power Company in the acquisition of the necessary rights-of-way for these transmission lines by which we bring our power supply into this area. In fact, the Alpena Power Company actually gave us rights-of-way across their property. Certainly it would be inappropriate for us to attempt to serve any customer in their service area without their consent.'

Thus Consumers does not offer the service requested, does not profess to serve the area, has no power lines into the city in which Huron is located, and has requested no certificate of public convenience and necessity to the area in which Huron is located. Hence those cases involving an undertaking of service to an area, particularly where a statute empowers the commission to order reasonable extensions of the mains and service (e. g., People of State of New York ex rel Woodhaven Gas Light Company v. Public Service Commission, 269 U.S. 244, 46 S.Ct. 83, 70 L.ed. 255), are not controlling on the issue before us. If, under the circumstances related as to the position and dedication of Consumers, the commission is empowered to order such service to be rendered to Huron, it will require legislative mandate in the clearest possible terms. Finding such, a constitutional question of serious import would next be presented. ² It is pertinent to observe, also, with respect to the legislation under consideration, that its economic wisdom, or lack thereof, is not our concern. We do not weigh the relative merits of Alpena Power's possible loss of revenue if this service cannot be rendered by it, loss to stockholders, and ultimate passing of the burden to the customers of Alpena Power, against the effect upon Huron's competitive position if the direct purchase from Consumers' can be made at a lower rate than elsewhere. Those are matters of legislative concern. We have had presented to us, upon certiorari, an issue of law, the statutory authority of the conmission in the light of the facts before us to order the service, and upon that, and that only, do we propose to pass.

At the outset we will observe that the Michigan public service commission has no common law powers. As we stated in Sparta Foundry Co. v. Michigan Public Utilities Commission, 274 Mich. 562, 564, 267 N.W. 736:

'The Michigan public utilities commission is an administrative body created by statute and the warrant for the exercise of all its power and authority must be found in statutory enactments.'

W...