New Energy Economy, Inc. v. Shoobridge
| Decision Date | 10 November 2010 |
| Docket Number | Nos. 32,396, 32,409.,s. 32,396, 32,409. |
| Citation | 243 P.3d 746,149 N.M. 42,2010 -NMSC- 049 |
| Parties | NEW ENERGY ECONOMY, INC., Petitioner, v. Honorable William W. SHOOBRIDGE, Judge for New Mexico's Fifth Judicial District, Respondent, and Senator Carroll H. Leavell, et al., Real Parties in Interest. New Mexico Environmental Improvement Board, Petitioner, v. Honorable William W. Shoobridge, Fifth Judicial District Judge, Respondent, and Senator Carroll H. Leavell, et al., Real Parties in Interest. |
| Court | New Mexico Supreme Court |
New Mexico Environmental Law Center, R. Bruce Frederick, Douglas Meiklejohn, Eric Jantz, Santa Fe, NM, for Petitioner New Energy Economy, Inc.
Gary K. King, Attorney General, Eric R. Miller, Assistant Attorney General, Stephen A. Vigil, Assistant Attorney General, Santa Fe, NM, for Petitioner New Mexico Environmental Improvement Board.
Gary K. King, Attorney General, Nanette E. Erdman, Assistant Attorney General, Santa Fe, NM, for Respondent Honorable William W. Shoobridge.
Montgomery & Andrews, P.A., Louis W. Rose, Jeffrey J. Wechsler, Lara Katz, Santa Fe, NM, for Real Parties in Interest Senator Carroll H. Leavell, et al.
Miller Stratvert, P.A., Richard L. Alvidrez, Albuquerque, NM, for Real Parties in Interest Public Service Company of New Mexico and Southwestern Public Service Company.
Vinson & Elkins, L.L.P., Eric Groten, Bryan Moore, Austin, TX, for Real Party in Interest El Paso Electric Company.
{1} When the Legislature lawfully delegates authority to a state agency to promulgate rules and regulations, may a court intervene to halt proceedings before the agency adopts such rules or regulations? This question is one of substantial public interest because court intervention in administrative proceedings before the adoption of rules or regulations may thwart the public's right to participate in such proceedings. We hold that a court may not intervene in administrative rule-making proceedings before the adoption of a rule or regulation for three reasons. First, the separation of powers doctrine forbids a court from prematurely interfering with the administrative processes created by the Legislature. Second, only upon completion of administrative rule-making proceedings will a party be certain that it is aggrieved, since it is not known whether a regulation will even be adopted by the agency. Third, since the administrative proceeding is not complete, there is no actual controversy to be resolved by a declaratory judgment action.
{2} The Legislature empowered the Environmental Improvement Board (Board) to prevent or abate air pollution and to adopt or promulgate regulations consistent with the Air Quality Control Act. NMSA 1978, § 74-2-5 (1967) (as amended through 2007). This matter originated in a proposal to regulate greenhouse gas emissions that Petitioner New Energy Economy (New Energy) filed with the Board. The Board held a public meeting on January 5, 2009 in Santa Fe to determine whether to hold a hearing on New Energy's proposed regulation. At the hearing were representatives from the Public Service Company of New Mexico, the Dairy Producers of New Mexico, the New Mexico Oil and Gas Association, and the New Mexico Farm and Livestock Bureau, who asked the Board not to conduct a hearing, contending that the Board lacked the authority under the Air Quality Control Act, NMSA 1978, §§ 74-2-1 to -17 (1967) (as amended through 2007), to regulate greenhouse gas emissions unless it first established an ambient air quality standard. The Board decided to allow briefing on the matter and scheduled a hearing on the issue of its jurisdiction and authority for April 6, 2009.
{3} At the hearing on April 6, 2009 in Santa Fe, New Energy argued that (1) the Board had the authority to hold hearings on the matter, (2) the final regulation might vary from their proposed rule, and (3) the Board could adopt an ambient air quality standard in the rule-making context. The Board determined that it had the required authority to hear the matter and entered an order establishing a hearing schedule. The groups opposing the petition moved for a temporary stay of the proceedings and filed objections to the scheduling order. On December 31, 2009, public notice was given on New Energy's proposed rule. On January 13, 2010, those who had objected to the proposalduring the hearings before the Board and others (the plaintiffs) filed a complaint for a declaratory judgment and injunctive relief in the Fifth Judicial District Court in Lea County. The plaintiffs sought to enjoin the Board from conducting further administrative proceedings, arguing that the Board lacked statutory authority to consider or adopt New Energy's petition. New Energy and the Board filed motions to dismiss the action. The district court granted the plaintiffs' request for a preliminary injunction.
{4} The Board and New Energy petitioned this Court for a writ of superintending control or prohibition and requested a stay of the district court proceedings. The plaintiffs, as real parties in interest, opposed Petitioners' requests. We reviewed the district court's decision to issue a preliminary injunction for an abuse of discretion. LaBalbo v. Hymes, 115 N.M. 314, 318, 850 P.2d 1017, 1021 (Ct.App.1993). See also Allstate Ins. Co. v. Firemen's Ins. Co., 76 N.M. 430, 433-34, 415 P.2d 553, 555 (1966); NMSA 1978, § 44-6-7 (1975). A misapprehension of the law constitutes an abuse of discretion. See State v. Elinski, 1997-NMCA-117, ¶ 8, 124 N.M. 261, 948 P.2d 1209. For the reasons that follow, we granted the writ of superintending control and ordered the district court to dissolve the injunction issued in the case, dismiss the complaint, and remand the case to the administrative agency for further proceedings.
{5} The central issue is whether the district court erred in granting a preliminary injunction enjoining the Board from completing the rule-making process. The plaintiffs contend that the issue is answered by State ex rel. Hanosh v. Environmental Improvement Board [hereinafter Hanosh I], 2008-NMCA-156, ¶ 8, 145 N.M. 269, 196 P.3d 970, affirmed by State ex rel. Hanosh v. King [hereinafter Hanosh II], 2009-NMSC-047, 147 N.M. 87, 217 P.3d 100.
{6} In the two Hanosh cases, the district court was asked to construe a statute to determine whether the Environmental Improvement Board was acting within its legislative authority when it adopted regulations addressing automobile emissions. We affirmed the Court of Appeals, holding that a declaratory judgment action is an appropriate procedure to challenge the Board's statutory authority to adopt regulations. Hanosh I, 2008-NMCA-156, ¶ 8, 145 N.M. 269, 196 P.3d 970; Hanosh II, 2009-NMSC-047, ¶ 4, 147 N.M. 87, 217 P.3d 100. Under the circumstances of Hanosh II, we agreed that the plaintiffs could raise a purely legal challenge to the Board's statutory authority independent of the administrative appeal process. 2009-NMSC-047, ¶ 4, 147 N.M. 87, 217 P.3d 100.
{7} The plaintiffs argue that this case is precisely like the Hanosh cases because in Hanosh I the Board was in the process of considering proposed regulations when the plaintiffs filed their complaint seeking a declaratory judgment. They contend that because we upheld the Hanosh I court's jurisdiction to entertain the action, reasoning that the question before it was purely legal and did not require "special agency expertise or additional fact-finding," the court in this case should have the same authority. 2008-NMCA-156, ¶ 8.
{8} We do not find the Hanosh cases controlling. Although the complaint in the Hanosh cases was filed before the adoption of the regulations, those regulations were adopted on the same day the plaintiffs delivered their complaint to the Board. Hanosh I, 2008-NMCA-156, ¶ 1, 145 N.M. 269, 196 P.3d 970. Thus, the Board had actually issued a regulation at the time the district court heard the challenge to the regulation. This fact distinguishes the Hanosh cases from the one before us. Our holding in both Hanosh I and II should not be cited for the proposition that a court may intervene to halt an administrative rule-making proceeding before a rule or regulation is adopted.
{9} In addition, while we agree that the Board was not engaged in adjudicative fact-finding, the Board was attempting to hold hearings to develop legislative facts.
Unlike adjudicative facts, legislative facts do not concern individual parties, such as who did what, when, where, and how.... Legislative facts are those which help the tribunal to determine the content of lawand policy and to exercise its judgment or discretion in determining what course of action to take.
Quynh Truong v. Allstate Ins. Co., 2010-NMSC-009, ¶ 25, 147 N.M. 583, 227 P.3d 73 (quoting Lee v. Martinez, 2004-NMSC-027, ¶ 13, 136 N.M. 166, 96 P.3d 291 (internal quotation marks and citations omitted)). The interruption of this process of legislative fact-finding interfered with the Board's duty, mandated by the Legislature, to hold public hearings before regulations are adopted. See NMSA 1978, § 74-1-9 (1985); NMSA 1978, § 74-2-6 (1992). This process constitutes an essential part of the legislative branch's function to make policy choices. See State ex rel. Haragan v. Harris, 1998-NMSC-043, ¶ 23, 126 N.M. 310, 968 P.2d 1173 (Serna, J., dissenting) ().
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