Statesboro Tel. Co. v. Georgia Public Service Commission, 30081

• Decision Date: 16 September 1975
• Docket Number: No. 30081,30081
• Citation: 235 Ga. 179,219 S.E.2d 127
• Parties: The STATESBORO TELEPHONE COMPANY v. GEORGIA PUBLIC SERVICE COMMISSION et al.
• Court: Georgia Supreme Court

Page 127

219 S.E.2d 127

235 Ga. 179

The STATESBORO TELEPHONE COMPANY v. GEORGIA PUBLIC SERVICE COMMISSION et al.

No. 30081.

Supreme Court of Georgia.

Sept. 16, 1975.

Barwick, Bentley & Binford, M. Cook Barwick, Robert W. Hayes, James L. Ford, Atlanta, for appellant.

Lefkoff & Hanes, Robert J. Castellani, Paul L. Hanes, Atlanta, Francis W. Allen, Statesboro, Arthur K. Bolton, Atty. Gen., Timothy J. Sweeney, Staff Asst. Atty. Gen., Atlanta, for appellees.

Long & Aldridge, Clay C. Long, Powell, Goldstein, Frazer & Murphy, J. Winston Huff, Daryll Love, Alston Miller & Gaines, L. Neil Williams, Jr., John K. Train, III, William Rothschild, Atlanta, amicus curiae.

HILL, Justice.

The Georgia Public Service Commission granted a certificate of public convenience and necessity to Bulloch County Rural Telephone Cooperative ('Bulloch') which competes with a prior certificate held by Statesboro Telephone Company ('Statesboro'). Statesboro filed suit in Fulton Superior Court for injunction, which was denied when Bulloch's motion for summary judgment was granted and Statesboro's motion for summary judgment was denied.

The primary issues in this case relate to the right of the holder of a certificate of public convenience and necessity to be protected against the grant of a competing certificate. Several telephone companies have filed briefs, amici curiae, supporting Statesboro's position.

Prior to the commencement of these proceedings before the Public Service Commissional, Statesboro held a certificate to provide local telephone service in and adjacent to the City of Statsboro. Bulloch held certificates to provide local service in the towns of Portal, Clito, Brooklet and Nevils in Bulloch County around the City of Statesboro. However, Statesboro held a certificate to provide toll (long distance) service to its exchanges and to Portal, Clito and Brooklet. In fact, Statesboro had provided toll service to Nevils since 1956 although not certificated to do so.

Bulloch filed an application with the commission for a certificate to provide toll service to Portal, Clito, Brooklet, Nevils and its new exchange, Anderson, along a semicircular route north, east and south of the City of Statesboro. Statesboro was notified of this application which was partially based upon inadequacy of toll service being provided by Statesboro. A hearing on Bulloch's application was held before the commission on September 23, 1973, at which Statesboro appeared.

Statesboro filed an application for a toll certificate to serve Nevils and Anderson. The applications of Bulloch and Statesboro were consolidated and a second hearing was held on November 28, 1973, at which Statesboro offered no additional evidence.

The evidence before the commission showed that equipment Statesboro admitted needing in 1970 had not been fully installed in 1974, that much of Statesboro's installed equipment was either out of service, overloaded, substandard, obsolete or experiencing loss of transmission or noise interference, and generally that toll service furnished by Statesboro was inadequate. It would serve no useful purpose to detail those deficiencies in this opinion.

The commission denied Statesboro's application to serve Nevils and Anderson and granted Bulloch's application to provide toll service to its local service subscribers. Statesboro's existing toll certificate was left in effect, except that Bullock thereafter would route toll calls from its exchanges over its toll lines. A drawing of Statesboro's toll certificate would resemble the spokes of a wheel with the City of Statesboro at the hub; a drawing of Bulloch's toll certificate would resemble a three-quarter rim of that wheel.

Statesboro filed suit to enjoin the commission from enforcing its two orders and Bulloch intervened as a defendant. ¹ The certificate holders each moved for summary judgment. No evidence not before the commission was offered in support of or in opposition to these motions. Following a hearing at which the commission's record was put in evidence, Bulloch's motion was granted and Statesboro's was denied. Statesboro appeals.

Statesboro enumerates the trial court's order granting Bulloch's motion for summary judgment as error in that (1) it denied Statesboro its right to present evidence upon the issue of whether the commission's orders were arbitrary, capricious, unreasonable and confiscatory; (2) there were genuine issues of material fact as to whether the commission's orders were arbitrary, capricious, unreasonable and confiscatory; (3) the trial court's order was erroneous in finding that the commission's orders were not arbitrary, capricious, unreasonable or confiscatory; and (4) that order deprived Statesboro of its property without due process of law in violation of the State and Federal Constitutions.

1. In Georgia Public Service Commission v. General Telephone Co.,227 Ga. 727, 182 S.E.2d 793, a utility regulated by the Public Service Commission filed suit to enjoin rates set by the Commission in 1970 based on hearings held in 1969 using 1968 as a test year, contending that such rates were confiscatory. The trial court considered evidence not only for the test year but also subsequent thereto up to the date of the commission's rate order in determining the question of confiscation. On appeal the commission contended that the utility had failed to exhaust its administrative remedies. It was held that the commission is not permitted to defend such a suit on the ground of failure to exhaust administrative remedies where the commission had entered a final rate order and the utility's motion for rehearing had been denied.

It should be noted that in the General Telephone case, the evidence considered by the commission in fixing rates was limited to the test year ending December 31, 1968, and that its decision was rendered in June 1970. The General Telephone case does not stand for the proposition that every order of the Public Service Commission granting or denying a certificate of public convenience and necessity is subject to a complete trial de novo in the Superior court. For example, a utility opposing the grant of a competing certificate should not withhold evidence from the commission expecting to introduce it in court where it will not be subject to examination and consideration by the commission and its staff. Withholding such evidence from the commission would amount to a failure to exhaust administrative remedies.

Moreover, General Telephone does not exempt suits against the commission from the summary judgment procedures of Code Ann. § 81A-156(c), which provides that the party opposing the motion shall serve opposing affidavits and if there is no genuine issue as to any material fact, judgment shall be rendered without trial by jury.

The trial court did not deny Statesboro its right to present evidence (affidavits) showing the existence of genuine issues of material fact.

Although the transcript of the hearings before the commission showed issues of fact, those issues were resolved adversely to Statesboro by the commission. When those transcripts were before the trial court on motion for summary judgment, the question was not whether the transcripts showed issues of fact requiring a trial, but was whether the evidence before the trial court showed that the commission's order were valid or invalid.

As stated in Georgia Public Service Commission v. Georgia Power Co., 182 Ga. 706, 715-716, 186 S.E. 839, 844-845: 'The courts should not interfere with a valid order of the Public Service Commission unless it be clearly shown that the order is unreasonable, arbitrary, or confiscatory . . . If the evidence clearly showed that the requirement of the commission was unreasonable, capricious, or confiscatory, the court would be bound to set such finding aside as unlawful in the taking of property without due process of law. Otherwise the court has no such authority.'

We therefore turn to consideration of Statesboro's statutory and constitutional rights to determine whether the commission's orders were valid.

2. Statesboro contends that the commission lacks authority to grant a competing certificate unless the commission determines that the existing certificate holder is providing inadequate service and is unable or refuses, after notice and hearing, to provide reasonably adequate service.

Statesboro obtained its toll certificate pursuant to the 'grandfather' provisions of Ga.L.1950, pp. 311, 313, Sec. 5 (Code Ann. § 93-328). This Act has not heretofore been interpreted by appellate decision.

The 1950 act provides that the commission shall not grant a telephone certificate without notice to any telephone company or cooperative 'occupying the territory affected', Ga.L.1950, pp. 311, 312, 314, Secs. 3, 8 (Code §§ 93-326, 93-330). That is to say, the 1950 Act by which Statesboro obtained its toll certificate contemplates the issuance of competing certificates after notice of application for such competing certificates (Ga.L.1950,[235 Ga. 183] pp. 311, 312, Sec. 4 (Code Ann. § 93-327)). See also Ga.L.1950, pp. 311, 312, Sec. 2 (Code Ann. § 93-325).

Statesboro contends that the opportunity afforded by statute to motor carriers to remedy inadequate service before a competing motor carrier certificate is granted (Ga.L.1931, pp. 199, 201, as amended by Ga.L.1950, pp. 186, 187; Code Ann. § 68-609), and the opportunity which was afforded by statute to radio common carriers and telephone and telegraph companies to remedy inadequate service before a competing radio common carrier certificate was granted (Ga.L.1970, p. 104, Sec. 2(4e). See Code Ann. § 93-902(e) as it existed prior to amendment by Ga.L.1972, p. 439, should be viewed as expressing the intent of the General Assembly that no competing certificate of public convenience and necessity should be granted until the existing certificate holder has been afforded an opportunity to remedy any inadequacy in service.

We...