Kennelly v. Kent County Water Authority, 984

• Citation: 89 A.2d 188,79 R.I. 376
• Decision Date: 29 May 1952
• Docket Number: No. 984,984
• Parties: KENNELLY, Public Utility Adm'r, v. KENT COUNTY WATER AUTHORITY et al. M. P.
• Court: United States State Supreme Court of Rhode Island

Page 188

89 A.2d 188

79 R.I. 376

KENNELLY, Public Utility Adm'r, v. KENT COUNTY WATER AUTHORITY et al.

M. P. No. 984.

Supreme Court of Rhode Island.

May 29, 1952.

William E. Powers, Atty. Gen., Robert A. Coogan, Asst. Atty. Gen., for petitioner.

Michael DeCiantis, Town Sol., West Warwick, as amicus curiae, for Town of West Warwick.

Hinckley, Allen, Salisbury & Parsons, Stuart H. Tucker, Douglas W. Franchot, Providence, for respondents.

CONDON, Justice.

This is a petition brought by the public utility administrator pursuant to General Laws 1938, chapter 122, § 28, praying this court to direct the respondent Kent County Water Authority, hereinafter called the Authority, to file in the office of the administrator a schedule of rates and charges together with a copy of its rules and regulations. The petition further prays that said respondent and its predecessor companies, which are also respondents, be permanently enjoined from putting into effect any rates until they have been so filed, and that all moneys which the respondent Authority has received from ratepayers in excess of legally approved rates heretofore filed by said companies be held in trust pending the determination of this proceeding. Upon the filing of the petition we granted the last-mentioned prayer and such moneys are now on deposit with the Industrial Trust Company, a banking corporation of this state, as trustee.

In reality this controversy is between only the administrator and the Authority, the respondent companies having disclaimed any interest. It concerns the construction of the following proviso in section 2 of chapter 122: 'Provided, that this chapter shall not be construed to apply to any public water works and water service owned and furnished by any city, town, water district, fire district or any other municipal or quasi-municipal corporation.' The Authority, which will hereinafter be considered as the sole respondent, contends that it is included within that proviso and is therefore not required to file a schedule of its rates or a copy of its rules and regulations in the office of the administrator. The administrator argues that only a municipal or quasi-municipal corporation can claim the benefit of such proviso and that the respondent is neither. He further contends that if the proviso is more broadly construed so as to include the respondent it would be invalid. However, on the view which we take it will not be necessary to consider this latter contention.

The respondent Authority was created by Public Laws 1946, chap. 1740, and was authorized to acquire the water works and services of several privately-owned water companies then serving the municipalities of Kent county and some users of water in Scituate and Cranston in Providence county. The rates of such companies were on file in the office of the administrator when the respondent acquired those companies, but within a short time thereafter, following a servey by engineers retained by respondent, it revised such rates upward without first submitting them to the administrator for his approval. It relied for its right to take such action on the provisions of section 1 and 5 of chapter 1740 which read as follows:

'Section 1. There is hereby created a district to be known as the Kent county water district (hereinafter called the 'district'), a political subdivision, whose boundaries shall be coterminus with the boundaries of Kent county. A board to be known as the Kent county water authority is hereby created. Such board shall be a body corporate and politic constituting a public benefit corporation and shall serve as the governing body of the district for the purposes of this act.'

'Sec. 5. It is hereby declared that the authority and the carrying out of its corporate purposes is in all respects for the benefit of the people of the State of Rhode Island and Providence Plantations, for the improvement of their health, welfare and prosperity, and the authority will be performing an essential governmental function in the exercise of the powers conferred by this act, and the State of Rhode Island and Providence Plantations covenants * * * that the bonds of the authority and the income therefrom shall at all times be exempt from taxation.'

The claim is made, as we understand it, that the language of those sections indicates an intention of the legislature to endow respondent with the attributes of a quasi-municipal corporation such as a fire district. If that claim is valid there can be no question that respondent would not be obliged to comply with chapter 122, and conversely if it is invalid respondent would be so obligated. Originally, the proviso of section 2 was expressly limited to a city or town. In East Providence Water Co. v. Public Utilities Comm., 46 R.I. 458, 128 A. 556, 559, decided in 1925, this court held that a fire district was not included under the words 'city or town' as they were municipal corporations whereas a fire district...