Radio Communications, Inc. v. Public Service Commission

Decision Date30 January 1974
Docket NumberNo. 128,128
PartiesRADIO COMMUNICATIONS, INC. v. PUBLIC SERVICE COMMISSION of Maryland et al.
CourtMaryland Court of Appeals

Henry F. Leonnig, Upper Marlboro, for appellant.

Jess Joseph Smith, Jr., Sp. Counsel, Upper Marlboro, for Public Service Commission of Md.

Louis B. Thalheimer, Baltimore (Calhoun Bond and Cable, McDaniel, Bowie & Bond, Baltimore, on the brief) for intervenors.

Argued before MURPHY, C. J., and BARNES, McWILLIAMS *, SINGLEY, SMITH, DIGGES and LEVINE, JJ.

LEVINE, Judge.

Although shrouded in a mass of technical evidence dealing with the complex subject of mobile radio communications, the primary question presented by this case is simply one of legislative intent. This appeal is brought by Radio Communications, Inc. (RCI)-a 'radio common carrier'-from an order of the Circuit Court for Prince George's County affirming a decision of the Public Service Commission of Maryland (the Commission), one of several appellees. The remaining appellees (the intervenors) are also radio common carriers who initially entered this case by intervening in the proceedings before the Commission.

Prior to July 1, 1971, radio common carriers were not regulated in the State of Maryland. In that year, the General Assembly enacted Chapter 543 of the Laws of 1971-the source of this controversy-which brought companies engaged in that field of communications under state regulation for the first time. This resulted in dual control, since the medium had already been under the jurisdiction of the Federal Communications Commission (FCC) prior to 1971.

Chapter 543 achieved a threefold purpose, all within the framework of Maryland Code (1957, 1973 Cum.Supp.) Art. 78. First, it amended § 2(o) of Art. 78, so as to embrace 'radio common carrier(s)' within the definition of "public service compan(ies)." Second, it added a subsection (ii) to § 2, defining a "Radio common carrier" as:

'. . . every public service company operating or managing a radio common carrier engaged in the business of providing a service of one-way or two-way radio communications and licensed as a miscellaneous common carrier by the Federal Communications Commission, but not engaged in the business of providing a public land line message telephone service or a public message telegraph service. The terms 'telegraph company,' 'telephone company,' or 'a person operating telegraph or telephone lines' when used in this article, shall not be construed to include radio common carriers.'

Third, Chapter 543 added § 55A to Art. 78. This is the vehicle by which such carriers were for the first time brought under state regulation. Since they are material to the disposition of this case, we repeat here subsections (a), (b) and (d) of § 55A:

'(a) When certificate required; rules and regulations.-No radio common carrier shall begin or continue the construction or operation of any radio common carrier system or any extension thereof, either directly or indirectly, without first obtaining from the Commission a certificate that the public convenience and necessity required such construction, operation or extension. However, this article shall not require not shall it be so construed to require any carrier to secure a certificate for any of the following:

'(1) An extension within any authorized service area within which the carrier has heretofore lawfully commenced operations, (2) any extension within or to territory already served by the carrier, necessary in the ordinary course of business, (3) substitute facilities within or to any authorized service area or territory already served by such carrier, (4) any extension into territory contiguous to that already served by the carrier and not receiving similar service from another carrier when no certificate of convenience and necessity has been issued to or applied for by any other radio common carrier, and (5) the acquisition, construction and operation of any plant or system heretofore constructed under authority of a certificate of convenience and necessity hereafter issued. The Commission is authorized to prescribe appropriate and reasonable rules and regulations governing the issuance of the certificates.

'(b) Certification of carriers licensed by Federal Communications Commission.-Any company not presently franchised or certificated by the Commission as a radio common carrier but engaged in the operation of any radio common carrier system licensed by the Federal Communications Commission on July 1, 1971, shall, upon qualification as a public service company, receive a certificate of convenience and necessity from the Commission authorizing the company to continue the operation of the radio common carrier in the territory professed to be served by that company on July 1, 1971, if, within ninety days after this act becomes effective, that company shall file with the Commission an application for the certificate, including copies of any license or licenses issued by the Federal Communications Commission to that company, showing the area professed to be served by that company.

'(d) Duplication of or competition with existing services.-The Commission shall not grant a certificate for a proposed radio common carrier operation or extension thereof into the established service area which will be in competition with or duplication of any other certificated radio common carrier unless it shall first determine that the existing service is inadequate to meet the reasonable needs of the public and that the carrier operating the same is unable to, refuses or neglects, after hearing on reasonable notice, to provide reasonably adequate service.' (emphasis added).

The evidence discloses that mobile radio communications is a rapidly expanding branch of the communications field. Essentially, radio common carriers provide a mobile communications service either by two-way transmission or one-way signalling. they operate base stations at which are located transmitters and receivers. The control point or message center, however, is the actual hub of the operation. The carrier operates it transmitters and receivers on channels or frequencies assigned by the FCC within a band allocated for that purpose. In Maryland, there are only two instances of co-channels, an arrangement under which a single radio frequency is shared by two or more radio common carriers. RCI participates in one of those co-channels. They are permitted by the FCC when agreed to by the participants.

Those who subscribe to a mobile communications service purchase or lease a mobile radio set, which may include a transmitting and receiving device for two-way communications or simply a receiver if only a one-way signalling service is desired.

Prior to 1971, radio common carriers were regulated only if they provided services utilizing 'interconnections' with 'land line' telephone systems. The most frequently cited illustration of how this interconnection operates is the placement of a call from a subscriber's office to one of its mobile units in the field. The caller, by a regular telephone call, reached the control point operated by the radio common carrier, which then completes the call to the mobile unit by radio. Although there are calls made completely by radio, for example, from one mobile unit to another, it is apparent that the 'interconnection' with regular telephone systems is the most prominent phase of this communications field.

It is this interconnection with land line telephone systems that first brought radio common carriers under limited scrutiny of the Commission. Even prior to 1971, radio common carriers were required to obtain Commission approval of services utilizing such interconnections. Thus, shortly after its formation in 1960, RCI applied to the Commission for the right to exercise its 'franchise' in the seven counties in which it was then operating as a radio common carrier: Anne Arundel, Calvert, Charles, Howard, Montgomery, Prince George's and St. Mary's. In March 1963, the Commission issued an order authorizing RCI 'to exercise franchises and rights, including the franchise granted to the said company by its certificate of incorporation for the operation of a radio communications system in the State of Maryland . . . as and to the extent set forth and described in this proceeding.' 1

After Chapter 543 became effective, the Commission held a hearing on August 4, 1971, following which, pursuant to the authority expressly conferred by § 64 of Art. 78 and subsection (a) of § 55A, it promulgated by an order dated September 27, 1971, '. . . rules and regulations (effective September 29, 1971) governing the issuance of certificates of public convenience and necessity for radio common carriers under Section 55A . . ..' Pursuant to those rules and § 55A, RCI and other radio common carriers-including intervenors-promptly filed applications for certificates of public convenience and necessity.

In its application, RCI sought to exercise a franchise for the following political subdivisions of the state: the City of Baltimore and the counties of Anne Arundel, Baltimore, Calvert, Carroll, Cecil, Charles, Caroline, Dorchester, Frederick, Harford, Howard, Montgomery, Prince George's, Queen Anne's, Somerset, St. Mary's, Talbot, Washington and Wicomico. The intervenors took a rather dim view of this preemptive bid and, regarding it as a flagrantly expansionist move by RCI, leaped into the affray. Several hearings ensued, which were characterized by polemics on the part of the protagonists and admirable restraint on the part of the Commission. Thus, merely two witnesses managed to produce three substantial volumes of testimony.

The sole witness who testified for RCI was its president, Boyd King (King); and for the intervenors, John E. Dettra, Jr., (Dettra), a radio engineer. Since most of this evidence is not material to the disposition of this appeal, no useful purpose could possibly be served by an extensive...

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