Moongate Water Co. v. City of Las Cruces
| Decision Date | 09 January 2012 |
| Docket Number | No. 27,889.,27,889. |
| Citation | 269 P.3d 1,2012 -NMCA- 003 |
| Parties | MOONGATE WATER COMPANY, INC., a New Mexico public utility, Plaintiff–Appellant/Cross–Appellee, v. CITY OF LAS CRUCES, Defendant–Appellee/Cross–Appellant. |
| Court | Court of Appeals of New Mexico |
OPINION TEXT STARTS HERE
Kyle W. Gesswein, William A. Walker, Jr., Las Cruces, NM, for Appellant.
Keleher & McLeod, P.A., Spencer Reid, Thomas C. Bird, Kurt Wihl, S. Charles Archuleta, Albuquerque, NM, City of Las Cruces, Marcia B. Driggers, Assistant City Attorney, Las Cruces, NM, for Appellee.
{1} This appeal requires us to consider whether a certificate of public convenience and necessity (CCN) issued by the Public Regulatory Commission (PRC) grants a public utility exclusive service rights against a municipality with a population less than or equal to two hundred thousand people. The district court granted summary judgment against the City of Las Cruces (the City) and found that the City's expansion into the service area of Moongate Water Co., Inc. (Moongate) constituted a partial taking of Moongate's exclusive property interest under its CCN. After a subsequent evidentiary hearing, the district court found that the evidence did not support an award of damages to Moongate as a result of the taking. Moongate appeals the district court's damages determination, arguing that denying any value for the partial taking of its property interest was error and per se unconstitutional. In a cross-appeal, the City contends that the district court erred by determining that Moongate's CCN granted it exclusive service rights against the City, and absent a right of exclusivity, the district court erred by concluding that a taking occurred.
{2} We hold that the district court erred in determining that Moongate acquired exclusive service rights against the City through its CCN, and consequently, the court erred in awarding summary judgment to Moongate on the taking issues. As a result, we reverse the district court's award of summary judgment in favor of Moongate on its claims of a partial taking of its property interest by inverse condemnation (Count II) and regulatory taking of that interest under constitutional taking clauses (Count III), and we remand for further proceedings consistent with this Opinion. Because we reverse on these grounds, we do not reach the additional arguments raised by the parties on appeal.
{3} Since 1983, Moongate has been a privately owned and regulated public utility company supplying water to rural residents in an unincorporated area referred to as the East Mesa and Organ Pass area on the outskirts of Las Cruces city limits, including Section 15. Over time, development in Section 15 required that Moongate expand its system by extending water lines and increasing water storage capacity within this area.
{4} In 1995, the City began planning for population growth and city expansion on the East Mesa. The City secured water rights through the State Engineer's Office and secured capital funding to build additional water servicing infrastructure. In 2004 and 2005, the City also agreed to annex a portion of Section 15 as part of the development for three new subdivisions called Dos Sueños, Los Enamorados, and Rincón Mesa. The City constructed the necessary water lines and infrastructure as part of its municipal water utility system and began servicing water to the residents as they requested service in the three new subdivisions.
{5} Subsequent to the City's annexation and development approval for the new subdivisions in Section 15, Moongate filed a complaint and an amended complaint against the City. In Count I of the amended complaint, Moongate sought, among other things, a declaratory judgment stating that Moongate's CCN from the PRC gave it the exclusive right to provide water to the service area annexed by the City for the three new subdivisions. In Count II, Moongate requested payment of just compensation for the City's partial taking of its property right pursuant to the inverse condemnation statute, NMSA 1978, § 42A–1–29(C) (1983). Count III sought compensation for the regulatory taking of Moongate's property under the United States and New Mexico Constitutions.
{6} The City moved for summary judgment on all three counts, arguing that the City's municipal water utility was not subject to PRC regulation, Moongate's CCN did not give it an exclusive right to serve the disputed area against the City, and no taking occurred as a result of the lawful competition between the City and Moongate. Moongate subsequently filed a cross-motion for summary judgment on Counts II and III, arguing that Moongate was entitled to just compensation or damages as the result of the City's taking of Moongate's exclusive right to serve the disputed area.
{7} The district court granted summary judgment in favor of Moongate on Counts II and III, and Moongate subsequently withdrew its claims for relief under Count I. The court concluded that the City effectuated a taking of Moongate's property interest based upon the loss of Moongate's exclusive right to serve the relevant portion of Section 15 pursuant to its CCN. The court reasoned that unless otherwise determined by the PRC, Moongate's CCN was a grant of exclusive territory under NMSA 1978, Section 62–9–1 (2005). The court further interpreted NMSA 1978, Section 62–3–2.1(C) (1991), to prohibit the City from providing service in areas covered by Moongate's CCN until the City elected to be subject to the Public Utilities Act (PUA), NMSA 1978, Sections 62–1–1 to 62–6–28, 62–8–1 to 62–13–15 (), or exercised its authority to condemn the disputed area. The court further determined that Moongate would be entitled to provide proof of any damages that resulted from the City's intrusion into Moongate's service area, and the court set the evidentiary portion of the damages question for a bench trial.
{8} Thereafter, the district court proceeded with a bench trial to value the damages incurred by Moongate as a result of the taking of a portion of Moongate's exclusive CCN service area. Ultimately, the district court determined that the evidence did not support a damages award to Moongate.
{9} The City now appeals the district court's award of summary judgment in favor of Moongate on the taking issues in Counts II and III, arguing that the court erred as a matter of law in determining that Moongate's CCN granted it exclusive service rights against the City. Moongate appeals the district court's determination that the evidence did not support a damages award.
{10} On appeal, the parties' arguments regarding whether the district court erred in awarding summary judgment to Moongate on the taking issues and Moongate's entitlement to damages depend upon interpretation of the PUA to determine whether Moongate's CCN granted Moongate the exclusive right to serve the disputed area against the City's water system.
{11} Determining whether a CCN issued pursuant to the PUA extends exclusive service rights to a public utility against a municipal water system is a question of statutory interpretation that we review de novo. See Pub. Serv. Co. of N.M. v. N.M. Pub. Util. Comm'n, 1999–NMSC–040, ¶ 14, 128 N.M. 309, 992 P.2d 860 (). “Our goal in interpreting a statute is to determine and give effect to legislative intent.” N.M. Bd. of Veterinary Med. v. Riegger, 2007–NMSC–044, ¶ 11, 142 N.M. 248, 164 P.3d 947. In construing a statute, we first examine “the plain language of the statute, giving the words their ordinary meaning, unless the Legislature indicates a different [meaning] was intended.” N.M. Indus. Energy Consumers v. N.M. Pub. Regulation Comm'n, 2007–NMSC–053, ¶ 20, 142 N.M. 533, 168 P.3d 105. Additionally, “where several sections of a statute are involved, they must be read together so that all parts are given effect.” High Ridge Hinkle Joint Venture v. City of Albuquerque, 1998–NMSC–050, ¶ 5, 126 N.M. 413, 970 P.2d 599. Marbob Energy Corp. v. N.M. Oil Conservation Comm'n, 2009–NMSC–013, ¶ 9, 146 N.M. 24, 206 P.3d 135 (internal quotation marks and citation omitted).
{12} A municipality that owns or operates a water utility system is ordinarily authorized to furnish water outside its corporate boundaries pursuant to NMSA 1978, Section 3–27–8 (1965). However, this statutory authority is limited if the municipality is subject to the restrictions of the PUA, Sections 62–1–1 to –6–26.1 and 62–8–1 to –13–14. Morningstar Water Users Ass'n v. N.M. Pub. Util. Comm'n, 120 N.M. 579, 583, 904 P.2d 28, 32 (1995). The PUA is “a comprehensive regulatory scheme granting the PRC the policy-making authority to plan and coordinate the activities of New Mexico public utilities[.]” Doña Ana Mut. Domestic Water Consumers Ass'n v. N.M. Pub. Regulation Comm'n, 2006–NMSC–032, ¶ 16, 140 N.M. 6, 139 P.3d 166.
{13} The PUA expressly excludes a municipality from the definition of a “public utility,” and a municipality is not subject to the operation of the PUA or any of its provisions unless an exception applies. Section 62–3–3(E), (G). The PUA provides that “[i]n the absence of voluntary election by a municipality to come within the provisions of the [PUA], the municipality shall be expressly excluded from the operation of that act and from the operation of all its provisions, and no such municipality shall for any purpose be considered a public utility[.]” Section 62–3–3(E) (emphasis added). Additionally, Section 62–6–4(A) grants the PRC exclusive...
To continue reading
Request your trial
-
Moongate Water Co. v. City of Las Cruces
...that the CCN guaranteed Moongate exclusive service rights. Moongate Water Co. v. City of Las Cruces, 2012–NMCA–003, ¶ 2, ––– N.M. ––––, 269 P.3d 1. The Court also concluded that the district court erred in granting summary judgment in Moongate's favor because the grant was based on the dist......
- Moongate Water Co. v. City of Las Cruces