Riverton Val. Elec. Ass'n v. Pacific Power & Light Co.

• Decision Date: 17 April 1964
• Docket Number: No. 3183,3183
• Citation: 391 P.2d 489
• Parties: In the Matter of the Appeal of Riverton Valley Electric Association, Inc., from an Order of the Public Service Commission of Wyoming, dated August 2nd, 1961. RIVERTON VALLEY ELECTRIC ASSOCIATION, Appellant (Petitioner below), v. PACIFIC POWER AND LIGHT COMPANY, Appellee (Protestant below).
• Court: Wyoming Supreme Court

Page 489

391 P.2d 489

54 P.U.R.3d 342

In the Matter of the Appeal of Riverton Valley Electric Association, Inc., from an Order of the Public Service Commission of Wyoming, dated August 2nd, 1961.

RIVERTON VALLEY ELECTRIC ASSOCIATION, Appellant (Petitioner below), v. PACIFIC POWER AND LIGHT COMPANY, Appellee (Protestant below).

No. 3183.

Supreme Court of Wyoming.

April 17, 1964.

Donald Spiker, of Spiker & White, Riverton for appellant.

W. J. Wehrli, Casper, for appellee.

Richard E. Day, Special Asst. Atty. Gen., appearing as amicus curiae, submitted the matter on brief and oral argument, for the Public Service Commission of Wyoming.

Before HARNSBERGER, GRAY and McINTYRE, JJ.

Mr. Justice GRAY delivered the opinion of the court.

This is an appeal by Riverton Valley Electric Association, Inc., from a judgment of the district court confirming an arbitration award made by the Public Service Commission of Wyoming to settle a controversy between appellant and Appellee, Pacific Power and Light Company, over electrical utility service areas in Fremont County, Wyoming. Both parties are public utilities subject to regulation by the Commission.

The controversy came about in this way. Over the years appellee, or Mountain States Power Company its predecessor in interest, obtained Certificates of Public Convenience and Necessity from the Commission authorizing the construction, maintenance, and operation of facilities for the sale and distribution of electricity in the towns and environs of Lander, Riverton, Pavillion, Fort Washakie, and the communities of Arapahoe and Morton. In 1929, it also obtained such a certificate for an area containing approximately 775 square miles generally described by the Commission as an 'oval area' embracing lands lying within a distance of ten miles on each side of its transmission line running between Lander and Riverton, exclusive of the Hudson area. Appellee also has rights in other areas in the county, but the foregoing are the areas that enter into the dispute.

Appellant was organized soon after passage by Congress of the Rural Electrification Act of 1936. Its purpose was to obtain the benefits of the Act and to render an electrical service to members and consumers in the rural areas of Fremont County, Wyoming. By the year 1943, appellant had constructed and energized approximately 290 miles of transmission lines and was rendering service to 512 customers. It had not previously obtained authority for its operations from the Commission, but following a decision of this court in Rural Electric Co. v. State Board of Equalization, 57 Wyo. 451, 120 P.2d 741, 122 P.2d 189 (decided January 5, 1942), wherein it was held that such organizations were public utilities under our statutes, appellant made application to the Commission for a Certificate of Public Convenience and Necessity. The service area sought by appellant was quite extensive and the greater portion of the territory involved had not theretofore been certificated by the Commission to any electrical utility. It did, however, include the so-called 'oval area' previously certificated to Mountain States Power Company and the Hudson area previously certificated to Hudson Light and Power Company. As a result, both companies protested the granting of any rights to appellant that would interfere. After hearing, the Commission, even though recognizing the possibility of future conflict, granted a certificate to appellant for the service area requested, subject to the following limitations:

'* * * except the towns of Riverton, Hudson and Lander and their environs * * * and all rural customers, properties and premises now being served by the Mountain States Power Company or the Hudson Light and Power Company * * *.'

and:

'* * * that this Certificate of Public Convenience and Necessity is issued to Riverton Valley Electric Association, Incorporated, without prejudice to existing Certificates held in Fremont County, Wyoming, by Mountain States Power Company and Hudson Light and Power Company.'

In a subsequent proceeding initiated by appellant before the Commission for amendment of its certificate, the foregoing restrictions were restated and somewhat amplified by the Commission in its order of September 14, 1951. At the expense of some repetition, we quote the provisions pertinent to the potential conflicting areas, which read as follows:

'(a) Without prejudice to any of the rights of Mountain States Power Company under its existing Certificates of Public Convenience and Necessity.

'(b) That applicant shall not interfere with the rights of Mountain States Power Company to serve the towns and communities, properties, premises and customers now being served by it, including the environs of such towns and communities.

'(c) That in all cases of new and additional customers desiring service and capable of being served from the lines of either applicant or Mountain States Power Company, such customers shall be served from the most economical and feasible source, either as agreed upon between said parties or, in the event of disagreement, as determined by the Commission.

'insofar as said territory duplicates or overlaps territory now held by Mountain States Power Company under Certificates of Public Convenience and Necessity heretofore issued to it by the Commission.'

The foregoing limitations on appellant's authority have not since been modified, and despite the obvious potential for dispute no serious difficulty seems to have been encountered between the parties until early in the year 1961. By that time both were rendering service in areas outlying the towns of Lander and Riverton, and those areas were fast becoming focal points of dispute in the acquisition of new consumers. Some effort was made amicably to settle the matter, but this came to an end when appellee in March 1961 commenced the construction of a distribution line north of Lander for a distance of some two miles and another west for approximately the same distance.

After a preliminary skirmish in the trial court over the Lander extensions, appellant on March 24, 1961, filed with the Commission an application to clarify existing rights of each of the parties in the disputed certificated areas, and in substance asked the Commission to remove any such source of conflict by amending the certificates involved to the extent necessary to award and assign specific service areas to each of the parties. Before any action was taken on the application, the Commission invited the parties informally to meet with it and explore the possibility of reaching mutual agreement. The meeting was held, and when it became apparent that the parties' differences could not be reconciled, the Commission suggested resort to arbitration under the special power of the Commission, rather than proceeding formally upon appellant's application. The statute conferring power on the Commission to arbitrate is § 37-12, W.S.1957, and states as follows:

'Whenever any Wyoming public utility has a controversy with any other person and all the parties to such controversy agree in writing to submit such controversy to the commission as arbitrators, the commission may act as such arbitrators, and after due notice to all parties interested may proceed to hear such controversy, and their award shall be final.'

Adopting the Commission's suggestion, the parties by separate instruments submitted the controversy for arbitration. The submission of appellant was in keeping with the request made in its application, and it was therein stated that appellant 'consents that the Commission shall make its award in writing and that it shall be [sic] to the undersigned and Pacific Power & Light Company be final.' Appellee's submission tendered the same subject matter as appellant, and interjected also 'additional comparatively small areas in Fremont County in which one corporation or the other are [sic is] now serving consumers and which are wholly or partially isolated from the separately certificated area of the corporation rendering such service.' No objection was made by appellant to the inclusion of appellee's proposal, and it was at all times treated as embraced within the submission of the parties.

In carrying out its function as arbitrator, the Commission held two separate hearings at which the parties were afforded opportunity to present evidence and submit their respective proposals and contentions. In addition, the Commission, together with members of its staff, and with the parties' consent, made physical inspection of the areas and the properties and facilties involved. Following this it made in writing the 'ARBITRATION AWARD' so vigorously assailed by appellant. We deem it unnecessary here to recite the many details considered and settled by the award. Suffice it to say that it contains a rather complete discussion of the respective rights of the parties, the problems involved, the proposals of the parties for settlement, the contentions of the parties, and the evidence presented. Findings were made and it was ordered that one or the other of the parties withdraw from certain specifically defined areas; that the certificates of the parties be amended and limited accordingly in order to assign to each exclusive and specific service areas; that the parties work out an amicable exchange of customers in the affected areas; that studies and reports be made to the Commission for disposal, sale, or exchange of plant facilities necessitated by the award; and, subject to guidance and assistance from the Commission, the parties were directed and authorized to consummate all matters necessary to accomplish the purposes of the award.

Thereafter, appellant filed a motion for rehearing with the Commission, which was denied. Following this, the appellant, pursuant to the statutory provisions prescribing the manner and method of appeal from orders of the Commission to the district court (§ 37-45, W.S.1957), filed in said court ...