Mississippi Public Service Com'n v. Mississippi Power & Light Co.

• Decision Date: 31 December 1991
• Docket Number: No. 89-CC-1123,89-CC-1123
• Citation: 593 So.2d 997
• Parties: Util. L. Rep. P 26,166 MISSISSIPPI PUBLIC SERVICE COMMISSION v. MISSISSIPPI POWER & LIGHT COMPANY.
• Court: Mississippi Supreme Court

Page 997

593 So.2d 997

Util. L. Rep. P 26,166

MISSISSIPPI PUBLIC SERVICE COMMISSION v. MISSISSIPPI POWER & LIGHT COMPANY.

No. 89-CC-1123.

Supreme Court of Mississippi.

Dec. 31, 1991.

J. Harbour Mounger, William Bruce McKinley, Jackson, for appellant.

James K. Child, Wise Carter Child & Caraway, Henderson S. Hall, Jr., D. Michael Cockrell, Wise Carter Firm, Jackson, for appellee.

Before HAWKINS, P.J., and PITTMAN and McRAE, JJ.

PITTMAN, Justice, for the Court:

The primary issue in this appeal is the validity of rules adopted by order of the Mississippi Public Service Commission (MPSC). The Chancery Court of Hinds County held that each of the challenged rules were beyond the authority of the Commission to adopt. We affirm the chancery court as to all rules, except Rule 9 B(2). As to Rule 9 B(2), we reverse and reinstate the order of the MPSC.

I.

On May 13, 1986, the Mississippi Public Service Commission, acting pursuant to authority statutorily prescribed in Miss.Code Ann. Sec. 77-3-45 (Supp.1986), declared its intent to adopt revised Public Utility Rules of Practice and Procedure. Hearings in conformance with Sec. 77-3-45 and the Commission order were held. Interested parties, including Mississippi Power & Light Company (MP & L), appeared and submitted comments, suggestions and objections. A record was made of the proceedings. After the hearings and receipt of numerous suggestions and comments, the MPSC adopted proposed revised rules effective April 1, 1988. MP & L requested reconsideration and stay of the order. The MPSC denied the request.

MP & L appealed to the Chancery Court of the First Judicial District of Hinds County pursuant to Miss.Code Ann. Sec. 77-3-67 (Supp.1990). The Chancery Court reversed the order of the MPSC, holding en route that each of the rules exceeded MPSC's statutory authority, and that two of the rules violated due process requirements under the Fourteenth Amendment of the U.S. Constitution and Article 3, Sec. 14 of the Mississippi Constitution.

The MPSC appeals and raises five issues, only three of which require discussion:

(1) Was the order of the MPSC adopting the Rules in excess of the statutory authority or jurisdiction of the Commission?

(2) Was the order of the MPSC adopting the Rules in violation of constitutional rights?

(3) Was the order of the MPSC adopting the Rules outside the scope of the Commission's duty to issue such reasonable rules and regulations as may be reasonably necessary or appropriate to carry out the provisions of Chapter 3 of Title 77 of the Mississippi Code of 1972, as amended, as provided by Miss.Code Ann. Sec. 77-3-45 (Supp.1990)?

II.

The MPSC is a public administrative agency with the duty and power to regulate public utilities pursuant to the Mississippi Public Utilities Act, Miss.Code Ann. Sec. 77-3-1 et seq. (Supp.1990). MP & L is a public utility.

Miss.Code Ann. Sec. 77-3-45 (Supp.1990) states in part:

The Commission shall prescribe, issue, amend, and rescind such reasonable rules and regulations that may be necessary to carry out the provisions of this chapter.

The MPSC contends that the revised rules were adopted pursuant to statutory authority as well as inherent and implied authority. A judicial determination of the limits and boundaries of MPSC's authority requires some knowledge of the historical background from which our administrative law emerged and the treatment by this Court of authority delegated to administrative agencies by the legislature.

First a statutory agency has only legislation granted authority, there is no inherent authority. Administrative law is a true child of necessity. The major obstacle to development of the administrative process, however, has been the doctrine of separation of powers. We have adhered to the principle that governmental powers are divided into the executive, legislative, and judicial branches, and persons entrusted with power of one branch shall not encroach upon the power of another.

The necessities of our times have brought forth the creation of administrative agencies, merging powers from all three branches. This action in regard to statutory agencies, to some extent has emasculated the separation of powers doctrine. Hopefully those branches of government provided for by constitutional language continue to honor their separation and while supporting of the other branch do not encroach into prohibited areas. Throughout the administrative process, however, we have somehow retained the basic idea that executive, legislative, and judicial power should, wherever possible, be separated from each other.

When, however, we are making additions within a framework already established, the idea that the three powers should not be blended at any level in any one set of hands has become so impractical that our legislative bodies, with judicial approval and not directly contrary to the constitution, have had no hesitation in merging power for efficient administration. After all, the philosophers who developed the theory of separation of powers were not thinking in terms of the practical problems of fitting administrative powers into the existing structure of government. They had no pattern to follow, and they sought a broad framework on which a governmental process could be developed. Modern problems, such as those presented by our present governmental machinery for regulation necessary to proper business administration, were left to fit within the frame. We have found through experience that the true principle which should guide the allocation of power within the general framework is indeed not the principle of separation of powers but the principle of checks and balances which separation of power affords. We have little concern for avoiding a mixture of the three powers in the same statutory agency; we have much concern for avoiding or minimizing unchecked power and for maintaining the constitutional check and balance.

The identifying badge of the modern administrative agency has become the combination of judicial power (adjudication) with legislative power (rule-making). We have taken great pains to see that the agencies are created and funded by our legislative bodies, that the personnel are appointed and reappointed by the executive, and that the residual power of review remains in the judiciary. We have learned that danger of tyranny or injustice lurks in unchecked power, not in blended power. See Davis, Administrative Law Text, Sec. 1.09 at 27-30 (1959).

Understandably, the court refrains from interfering with duly delegated authority to an administrative agency, particularly where the rule making power of the agency is involved due to its legislative function. In exercising the check or review principle to restrain the agency from using unauthorized power, this Court has repeatedly stated that powers legislatively granted to and exercised by an administrative agency are limited to and must not exceed the authority prescribed by the legislative enactment. Miss. ex rel Pittman v. MPSC, 520 So.2d 1355 (Miss.1987); Reserve Life Insurance Co. v. Coke, 254 Miss. 936, 183 So.2d 490 (1966); United Gas Pipeline Co. v. Miss. Public Service Commission, 241 Miss. 762, 133 So.2d 521 (Miss.1961). Statutory provisions control with respect to the rules and regulations promulgated by such a body. Accordingly, such a body may not make rules and regulations which conflict with, or are contrary to, the provisions of a statute, particularly the statute it is administering or which created it. 73 C.J.S., Public Administrative Law and Procedure, Sec. 89 at 584, 585, 588 (1983).

A.

Miss.Code Ann. Sec. 77-3-51 (Supp.1990) provides:

Upon agreement of the parties in any proceeding, depositions of any witnesses may be taken and used in evidence pursuant to procedure for taking depositions which may be prescribed by rules and regulations of the commission. (emphasis added).

New Rule 6 F, Depositions, provides:

In any formal investigation or proceeding before the Commission, the Commission Staff or any party to the proceeding may, by agreement of all parties in interest or, in the discretion of the Commission, take the deposition of witnesses residing within or without the state in the manner prescribed by law for taking of deposition in civil actions in the courts of this state. (emphasis added).

The Chancery Court, in holding that New Rule 6 F was contrary to or exceeded the statutory authority, stated:

[t]here is no way this rule can be reconciled with the statute. The statute clearly gave the right to use a deposition only upon agreement of the parties, which could perhaps be done anyway. But to amend this statute by rule and grant the Commission in its discretion to use depositions in investigations or any proceeding in the discretion of the Commission the right gives the Commission authority over, above and beyond that granted by the Legislature, and the rule cannot grant additional authority, but only be used as a vehicle to use the authority already granted.

The Chancery Court properly perceived the attempt by the MPSC to abridge the authority given it by the legislature by use of a rule exceeding conferred power.

B.

New Rule 7 E, Suspension of Construction, provides:

The Commission may, by order, temporarily suspend Commission authority for the construction or acquisition of a facility, plant or other capital item, whether previously certificated or not, upon failure by a utility to adhere to the provisions of this rule or for its failure to timely provide the Commission or its staff with any reasonable information requested concerning the cost, purpose or construction of the facility, plant or other capital item. Except as specifically allowed by order of the Commission, the related capital expenditures on the suspended construction or acquisition shall not be allowed in rate base nor shall AFUDC ¹ accrue on such funds during any period of suspension.

Miss.Code Ann. Sec. 77-3-13(3) (Supp.199...