Mountain States Telephone & Telegraph Co. v. Public Service Commission of Utah

• Decision Date: 17 March 1944
• Docket Number: 6557
• Citation: 145 P.2d 790,105 Utah 266
• Parties: MOUNTAIN STATES TELEPHONE & TELEGRAPH CO. v. PUBLIC SERVICE COMMISSION OF UTAH
• Court: Utah Supreme Court

145 P.2d 790

105 Utah 266

MOUNTAIN STATES TELEPHONE & TELEGRAPH CO. v. PUBLIC SERVICE COMMISSION OF UTAH

No. 6557

Supreme Court of Utah

March 17, 1944

For former opinion, see 105 Utah 230, 142 P. 2d 873.

Rehearing denied.

W. Q Van Cott, of Salt Lake City, and Brock, Akolt & Campbell, of Denver, Colorado, for plaintiff.

Grover A. Giles, Atty. Gen., Clinton D. Vernon, of Logan, Warwick C Lamoreaux, of Salt Lake City, and Frank B. Warren, of New York City, for defendant.

WOLFE Chief Justice. McDONOUGH and WADE, JJ., concur. LARSON, Justice, dissenting. MOFFAT, J., participated in the original opinion but was, before consideration of the petition for rehearing, deceased.

OPINION

On Petition for Rehearing.

WOLFE Chief Justice.

The Commission commenced this proceeding to inquire into the reasonableness of the differences between the schedule of rates for intrastate toll service and the schedule for Long Lines interstate toll service. It found that the existing differences were unwarranted and discriminatory. It also found that there was no reasonable basis for any differences between the two schedules and ordered the schedule of intrastate rates reduced to the level of Long Lines rate. Mountain States objected to the new rate, not on the grounds that it was inherently unreasonable, but because it was based on evidence not calculated to show that it would be reasonable. Objection was also made that there was no substantial evidence to support the finding that there was no reasonable basis for any differences between the two schedules. We held that under Section 76-4-4, U. C. A. 1943, the Commission was required, after having found discrimination to exist, to find the just, reasonable or sufficient rates. Such a finding was made, but we held there was no substantial evidence to support it. We therefore set aside the order so reducing intrastate rates and remanded the matter for such further proceedings as the Commission deemed proper.

The Public Service Commission has upon several grounds petitioned this court to grant a rehearing. We are of the opinion that the petition should be denied. However, we deem it advisable to comment further upon one proposition urged in support of the petition.

The Commission has from the beginning placed considerable emphasis upon the fact that this proceeding was instigated only to inquire into alleged discrimination. In approaching this phase of the case counsel for the Commission correctly states that, with reference to other rates, a rate may be unreasonably discriminatory and yet be a reasonable rate in and of itself--that both rate schedules herein involved may lie within the zone of reasonableness, yet the differences between the two rate schedules be unjust, unreasonable and discriminatory. It is urged that the inquiry was primarily directed toward the reasonableness of the differences not the inherent reasonableness of the rates. This approach was discussed by the United States Supreme Court in American Express Co. v. State of South Dakota ex rel. Caldwell, 244 U.S. 617, 37 S.Ct. 656. 660, 61 L.Ed. 1352. The court there stated that a finding that discrimination exists between two rate schedules does not necessarily imply a finding that either or both of the two schedules are inherently reasonable or unreasonable; that in such a situation "Both rates may lie within the zone of reasonableness and yet involve unjust discrimination. Interstate Commerce Commission v. Baltimore & Ohio R. R. Co., 145 U.S. 263, 277, 12 S.Ct. 844, 36 L.Ed. 699. Proceedings to remove unjust discrimination are aimed directly only at the relation of rates." All discrimination cases are based upon the relationship of one rate to another. An inquiry into alleged discrimination need not necessarily deal with the inherent reasonableness of rates.

The Commission contends that in the event two rate schedules both lie within the zone of reasonableness or when there is no issue as to the reasonableness of the rates in question and yet when related one to the other, unreasonable discrimination is shown to exist, the Commission need not in making the adjustments determine whether or not the adjusted rate would be reasonable. That so long as the order of the Commission does not purport to establish a new rate which is outside the zone of reasonableness, the Commission must be held to have regularly pursued its authority and the court should not set its order aside.

In applying these various concepts to the facts of this case the Commission points out that this proceeding was instigated to compare two rate schedules one with the other, to wit: to compare Long Lines interstate rate schedule with Mountain States intrastate schedule. No contention was made that either of these two schedules lay outside the zone of reasonableness. It is not therefore necessary to determine whether either or both of these schedules are within that zone for in the...