Monochem, Inc. v. Louisiana Public Service Commission

• Decision Date: 31 March 1969
• Docket Number: Nos. 49353,49354,s. 49353
• Citation: 253 La. 1047,221 So.2d 504
• Parties: MONOCHEM, INC. and The Borden Company v. LOUISIANA PUBLIC SERVICE COMMISSION, East Ascension Telephone Company, Inc., and Southern Bell Telephone & Telegraph Company. 1 EAST ASCENSION TELEPHONE COMPANY, Inc. v. LOUISIANA PUBLIC SERVICE COMMISSION et al. 2
• Court: Louisiana Supreme Court

Page 504

221 So.2d 504

253 La. 1047

MONOCHEM, INC. and The Borden Company v. LOUISIANA PUBLIC SERVICE COMMISSION, East Ascension

Telephone Company, Inc., and Southern Bell

Telephone & Telegraph Company.

¹

EAST ASCENSION TELEPHONE COMPANY, Inc. v. LOUISIANA PUBLIC SERVICE COMMISSION et al.²

Nos. 49353, 49354.

Supreme Court of Louisiana.

March 31, 1969.

Rehearing Denied May 5, 1969.

Theo F. Cangelosi, John Schwab, Robert L. Cangelosi, Joseph H. Kavanaugh, Baton Rouge, for appellants.

Taylor, Porter, Brooks, Fuller & Phillips, Baton Rouge, for appllees.

HAMLIN, Justice:

East Ascension Telephone Company, Inc. (hereinafter referred to as EATEL) and the Louisiana Public Service Commission (hereinafter referred to as the Commission) jointly appeal to this Court from a judgment of the trial court which ordered EATEL to furnish Monochem, Inc. two additional foreign exchange telephones and The Borden Company three additional foreign exchange telephones, each from the Baton Rouge Exchange of Southern Bell Telephone & Telegraph Company to the two companies' plants at Geismar, Louisiana, and decreed that the interconnection charge of $75.00 per month in favor of EATEL on Monochem's and Borden's foreign exchange telephones located in Geismar, Louisiana, is invalid. The judgment further provided that any charge for foreign exchange service shall be that agreed upon by the parties or that fixed by the Commission in proper proceedings not inconsistent with this Court's decision in Monochem, Inc. v. Louisiana Public Service Commission, 247 La. 532, 172 So.2d 670 (1965).

In the Monochem case, supra, to which the present case is a sequel, this Court considered Order No. 9085 of the Commission which concluded that EATEL's charge for foreign exchange service, including full time talking circuits into the exchange area of another company, should be fixed at $75.00 per circuit per month. In affirming the judgment of the district court which vacated the Commission's order, we stated in part:

'We conclude * * * that insofar as East Ascension is concerned, 'cost' of establishing the instant foreign exchange service is the essential factor for consideration. The amount of East Ascension's investment is not shown in the record, nor does the record reflect that East Ascension renders any service or incurs any expense in connection with plaintiffs' calls to and from Baton Rouge. (Plaintiffs were Monochem, Inc., The Borden Company, and United States Rubber Company.) The contract is for a period of five years; (commencing in 1961) its dissolution is not urged.'

In the foregoing case we found that there was no immediate relationship between the amount assessed for the foreign exchange service and the tolls which might be collected without such service. (The Commission stated that it was obvious that EATEL was entitled to compensation for its loss in tolls.) We concluded that under the facts of That case the Commission's conclusions were arbitrary and not supported by the evidence. We also concluded that the Commission acted in an unreasonable manner and that its order could be reversed.

In reasons for judgment in the instant case, the district court stated:

'Shortly thereafter (Rehearing denied in the Monochem case, supra, March 29, 1965.), that is, on April 21, 1965, the Commission had under consideration a motion for a restraining order against East Ascension relative to its refusal to furnish foreign exchange service to some applicants unless they agreed to pay the additional $75 per month. The Commission held the matter open until such time as it could determine the rights of East Ascension in this connection. In the meantime it refrained from charging this additional $75 per month to the petitioners in the cited case. In an order dated July 23, 1965 the Commission ordered East Ascension to afford foreign exchange service to the extent of its ability upon the agreement of the customer to pay the additional $75 per month. The record here does not show whether the plaintiffs in the cited case were still relieved of this $75 per month charge. It is to be noted that the contract involved in the cited case was for a period of five years, and apparently expired in 1966. In any event, matters were undisturbed until the present plaintiffs filed an application with the Commission in February 1967 seeking an order directed to Southern Bell and East Ascension to furnish extended area service between their customers with the cost of such service to be allocated equitably among all the customers of both companies; * * *'

Plaintiffs further prayed that:

'(2) This Commission order East Ascension Telephone Company and Southern Bell Telephone & Telegraph Company to furnish three additional foreign exchange service lines from Southern Bell's Baton Rouge exchange to the Borden Company at Geismar, two additional foreign exchange service lines from Southern Bell's Baton Rouge exchange to Monochem, Inc. at Geismar, and one additional foreign exchange service line from Southern Bell's Baton Rouge exchange to United States Rubber Company;

'(3) That the rate for the foreign exchange service lines furnished to petitioners and other similarly situated be fixed at Southern Bell's one-party rate for customers of the Baton Rouge exchange plus a reasonable mileage charge for the extra line furnished for this service, with whatever allocation between Southern Bell and East Ascension this Commission deems to be equitable; and

'(4) Should this Commission determine not to require extended area service and not to order additional foreign exchange service lines at the rates herein prayed for, then the property of petitioners and others similarly situated should be allocated to the Baton Rouge exchange of Southern Bell.'

On October 30, 1967, after hearing had commenced on July 12, 1967, the Commission issued Order No. 9948, Docket No. 9997, which recited:

'This matter was considered at a regular Business and Executive meeting of the Commission held in Baton Rouge on October 20, 1967, and the Commission finds that the rates and charges presently in force are justified, and that the relief prayed for be and it is accordingly ORDERED Denied.'

On November 9, 1967, EATEL applied to the Commission for a rehearing; it alleged that the complainants were properly denied their petition to have put into effect the alterations in rates, service practices, and territories, but that the order Failed to make clear that the rates and charges presently in force for the provision by EATEL of foreign exchange service to all of its customers are to apply as well to the foreign exchange lines already in service to complainants.³ The Commission's Minutes of December 13, 1967 recite that the request for rehearing would be held in abeyance pending filing of briefs.

Monochem, Inc. and The Borden Company filed the instant proceeding in the Nineteenth Judicial District Court on December 14, 1967. They prayed that the Commission's Order No. 9948 be declared null, void, and of no effect, and that EATEL and Southern Bell Telephone & Telegraph Company be ordered to provide to them additional foreign exchange service lines, at Reasonable rates, as prayed for in their application before the Commission.⁴

EATEL filed a petition in the district court on January 17, 1968, in which it prayed for judgment 'providing that Louisiana Public Service Commission Order Number 9948 makes effective the charge presently made for foreign exchange telephone service by East Ascension Telephone Company alike to all foreign exchange telephone service rendered by it alike, including all foreign exchange telephone service rendered by it to Monochem, Inc., The Borden Company, and United States Rubber Company.'

The district court rendered the judgment, supra, and the appeal is now before us for consideration. EATEL and the Commission contend that the district court committed the following errors:

'1.

'In holding that East Ascension Telephone Company offered no evidence as to the cost of providing foreign exchange telephone service.

'2.

'In substituting its judgment for that of the Public Service Commission when the judgment of the Commission did not constitute an abuse of power and was not arbitrary or capricious or grossly contrary to the evidence, and no error of law had been committed.

'3.

'In leaving East Ascension Telephone Company with no tariff charge for the provision of foreign exchange service to appellees.'

EATEL and the Commission urge that the present record not only demonstrates an appropriate consideration of the cost factors to be taken into account in providing foreign exchange service, but moreover shows due regard for the other aspects of pricing a particular utility service. They submit that this Court will discern no whim or caprice, no error of law or abuse of discretion, which could justify substitution of judicial judgment for the of the Commission.

Monochem and Borden contend that this Court should affirm the lower court's holding and should enter an order requiring foreign exchange service to be rendered by EATEL to them, specifically ordering three additional foreign exchange telephones to be furnished to The Borden Company and two additional foreign exchange telephones to Monochem, Inc. In addition, they urge that a general order should be issued requiring additional foreign exchange telephones to be installed by EATEL when requested by Monochem and Borden or others similarly situated. They still further urge that this Court should establish a rate for foreign exchange service based on the one-party rate per customers of the Baton Rouge Exchange of Southern Bell Telephone & Telegraph Company, Inc. plus the mileage charge now in effect for extra line used for a foreign exchange service, to be applied to them and others similarly situated.

Ernest W. Watson, Communications Consultant carrying on a general consulting practice, appearing in behalf of EATEL, described as follows...