State ex rel. Public Service Com'n v. Bonacker

• Decision Date: 20 September 1995
• Docket Number: No. 20205,20205
• Citation: State ex rel. Public Service Com'n v. Bonacker, 906 S.W.2d 896 (Mo. App. 1995)
• Parties: STATE of Missouri ex rel. PUBLIC SERVICE COMMISSION, Relator, v. The Honorable Don BONACKER, Circuit Judge, Greene County Circuit Court, Respondent.
• Court: Missouri Court of Appeals

Page 896

906 S.W.2d 896

STATE of Missouri ex rel. PUBLIC SERVICE COMMISSION, Relator, v. The Honorable Don BONACKER, Circuit Judge, Greene County Circuit Court, Respondent.

No. 20205.

Missouri Court of Appeals,

Southern District,

Division One.

Sept. 20, 1995.

William K. Haas, Jefferson City, for relator.

Theodore L. Johnson, III, Springfield, for respondent.

FLANIGAN, Judge.

In this proceeding in prohibition, Rule 97, ¹ relator is the Public Service Commission, and respondent is the Honorable Don Bonacker, Judge of the Circuit Court of Greene County, Division III. In the underlying action in the circuit court, the commission, as plaintiff, pursuant to § 393.145, sought the appointment of a receiver for a sewer system operated by defendant Joseph William Gold, d/b/a Bill Gold Investments, Inc. ("Gold"). On April 21, 1995, respondent issued an order containing the following challenged portions:

(1) The commission is appointed "receiver under [§ 393.145], with the duties and responsibilities of the receiver set forth in [§ 393.145], and in the Order of this Court entered herein on August 23, 1994," and (2) "[The commission] is ordered to pay directly to Helms Environmental Services, Inc." ("Helms"), the prior receiver, "the sum of Eighteen Thousand Dollars ($18,000.00) within 45 days and all other amounts hereafter allowed for services as receiver."

On May 9, 1995, this court entered its preliminary order in prohibition, directing respondent not to enforce the challenged portions of the April 21, 1995 order.

The commission contends that the trial court exceeded its jurisdiction in appointing the commission as receiver of the sewer system and in directing it to pay compensation to Helms in that the legislature has not authorized the commission to serve as a receiver or to pay costs of a receivership.

"Prohibition lies only where an act in excess of jurisdiction is clearly evidenced and where there is no adequate remedy by way of appeal." State ex rel. Munn v. McKelvey, 733 S.W.2d 765, 771 (Mo. banc 1987). For the reasons which follow, this court holds that the challenged portions of the trial court's order are in excess of its jurisdiction and that there is no adequate remedy by way of appeal. The preliminary order in prohibition is made absolute.

Section 393.145 reads, in pertinent part:

"1. If the commission shall determine that any sewer or water corporation having one thousand or fewer customers is unable or unwilling to provide safe and adequate service or has been actually or effectively abandoned by its owners ... the commission may petition the circuit court for an order attaching the assets of the utility and placing the utility under the control and responsibility of a receiver.

"2. The summons and petition for an order attaching the assets of the utility and appointing a receiver shall be served as in other civil cases at least five days before the return date of the summons.

"3. The court shall after hearing determine whether to grant the petition. A receiver appointed pursuant to this section shall be a responsible person, partnership, or corporation knowledgeable in the operation of utilities.

"4. The receiver shall give bond, and have the same powers and be subject to all the provisions, as far as they may be applicable, enjoined upon a receiver appointed by virtue of the law providing for suits by attachment. The receiver shall operate the utility so as to preserve the assets of the utility and to serve the best interests of its customers. The receiver shall be compensated from the assets of the utility in an amount to be determined by the court.

"5. Control of and responsibility for the utility shall remain in the receiver until the utility can, in the best interest of its customers, be returned to the owners. If the court determines after hearing that control of and responsibility for the utility should not, in the best interests of its customers, be returned to the owners, the receiver shall proceed to liquidate the assets of the utility in the manner provided by law."

On December 1, 1993, the commission filed the underlying action against Gold, who was duly served with process. On August 23, 1994, following a hearing at which Gold defaulted, the court entered judgment which included the following findings: Gold is a sewer corporation and public utility subject to the jurisdiction of the commission; Gold owns and operates a sewer system located in Greene County; the system has approximately 110 customers; Gold is unable to provide safe and adequate services to the customers of the sewer system; Helms is a responsible corporation, knowledgeable in the operation of utilities.

The judgment appointed Helms as receiver and ordered it to take control of the sewer system and its assets. Helms was ordered to manage and operate the system in compliance with the Public Service Commission law and regulations and subject to the court's supervision.

On March 29, 1995, Helms requested that it be removed as receiver. On April 19, 1995, at the hearing on the request, the commission and Helms appeared by their respective counsel. On April 21, 1995, respondent issued the challenged order, which also included the findings set forth in the following two paragraphs:

Helms has faithfully acted as receiver. The cost of the operation was greater than customer payments at the rate authorized by the commission for sewer services. The court previously ordered a sale of the sewer system to the highest bidder, but there were no bidders at the well-publicized public auction.

In November 1994, the court ordered the receiver to apply to the commission for a rate increase. "The proceeding for a rate increase is stalled. Action by [the commission] granting an increase has not been forthcoming." The court has no funds to compensate Helms or to interest a new receiver. Action by the commission on the rate increase request is not expected in time to prevent a total collapse of sewer services to individual homes and treatment of the sewage. "Compliance with the regulations of the Department of Natural Resources, Division of Environmental Quality, State of Missouri requires expenditures exceeding present receipts, technical expertise and time consuming supervision." Section 393.145 requires the court to appoint a receiver knowledgeable in the operation of utilities. Helms is entitled to additional partial compensation as receiver of at least $18,000.

In State v. Public Service Commission, 312 S.W.2d 791, 796 (Mo. banc 1958), the court said:

"The public service commission is essentially an agency of the Legislature and its powers are referable to the police power of the state. It is a fact-finding body, exclusively entrusted and charged by the Legislature to deal with and determine the specialized problems arising out of the operation of public utilities. It has a staff of technical and professional experts to aid it in the accomplishment of its statutory powers. Its supervision of the public utilities of this state is a continuing one and its orders and directives with regard to any phase of the operation of any utility are always subject to change to meet changing conditions, as the commission, in its discretion, may deem to be in the public interest."

The commission is purely a creature of statute, and its powers are limited to those conferred by statute, either expressly or by clear implication as necessary to carry out the powers specifically granted. State ex rel. Util. Consumers Council, Etc. v. P.S.C., 585 S.W.2d 41, 49 (Mo. banc 1979). " '[N]either convenience, expediency or necessity are proper matters for consideration in the determination of' whether or not an act of the commission is authorized by the statute, State ex rel. Kansas City v. Public Service Comm'n, 301 Mo. 179, 257 S.W. 462 (banc 1923)." Id. at 49. "[I]t must be kept in mind that the commission's authority to regulate does not include the right to dictate the manner in which the company shall conduct its business." State v. Public Service Commission, 406 S.W.2d 5, 11 (Mo. banc 1966).

Citing C.J.S. Receivers § 75, the commission argues that the office of receiver may not be imposed on one without his consent and that the commission did not and could not consent to act as receiver over the sewer system. Citing C.J.S. Receivers § 71, the commission argues that no one should be appointed as a receiver who would by the appointment be placed in a dual position such that there must arise conflicts between his personal interest and his duty as receiver, or whose duty it might be at some time to call the receiver to account. The challenged order, argues the commission, would place the commission "in the conflicting position of regulator and regulated." The commission argues that there is no statutory authorization for it to act as receiver of the utility and adds, "[b]y comparison, § 375.176 specifically authorizes the Director of Insurance to be appointed as the receiver over an insurance company in certain circumstances." ²

Seeking to uphold the appointment of the commission as receiver, respondent argues that § 393.145 "does not provide specific statutory direction when there are no volunteers to serve as receiver and the original owner is unable or unwilling to provide safe and adequate service to its customers." Respondent's brief also states:

"Although acting as a court appointed receiver is not a power specifically granted to the commission, the commission is vested with broad powers in addition to the specifically...