U.S. v. Public Utilities Com'n

• Court: Rhode Island Supreme Court
• Writing for the Court: SHEA; MURRAY
• Citation: U.S. v. Public Utilities Com'n, 635 A.2d 1135 (R.I. 1993)
• Decision Date: 24 December 1993
• Docket Number: No. 92-516-M,92-516-M
• Parties: , Util. L. Rep. P 26,363 UNITED STATES of America v. PUBLIC UTILITIES COMMISSION OF the STATE OF RHODE ISLAND et al. P.

Page 1135

635 A.2d 1135

150 P.U.R.4th 31, Util. L. Rep. P 26,363

UNITED STATES of America v. PUBLIC UTILITIES COMMISSION OF the STATE OF RHODE ISLAND et al.

No. 92-516-M.P.

Supreme Court of Rhode Island.

Dec. 24, 1993.

Everett C. Sammartino, U.S. Atty., Audrey Vandyke, Washington, DC, for plaintiff.

Paul J. Roberti, Sp. Asst. Atty. Gen., Julio Mazzoli, Asst. Atty. Gen., Peter McGinn, Joanne Conte, Tillinghast, Collins & Graham, Providence, Daniel Schatz, Dept. of Business Regulations, Hugo Ricci, Ricci & Ricci, Providence, Paul Ivaska, Boston, MA, for defendant.

OPINION

SHEA, Justice.

This case came before the Supreme Court upon the granting of the petition of the Department of the Navy (Navy) for a writ of certiorari under G.L.1956 (1990 Reenactment) § 39-5-1 to review a report and order of the Rhode Island Public Utilities Commission (the commission) in docket No. 2036. The granting of the petition was without prejudice to the parties raising the issue of the timeliness of the Navy's petition. We summarize the pertinent facts as follows.

On December 27, 1991, the Newport Electric Corporation (the company), a public utility subject to the provisions of G.L.1956 (1990 Reenactment) title 39, filed two applications for rate relief with accompanying rate schedules with the commission. The proposed rate schedule was designed to collect additional revenues in the amount of $7,343,531 or an increase of 13.6 percent.

The first phase (phase 1) was to become effective January 27, 1992. The proposed change consisted of the normal increase in cost of service and totaled $6,093,664, an increase of approximately 11 percent. The second phase (phase 2) was to become effective January 1, 1993. Phase 2 consisted of $1,249,867, a 2.6 percent increase, and pertained only to the impact of the Financial Accounting Standards Board Statement. ¹

Pursuant to § 39-3-11, the commission suspended the effective date, of the phase 1 rate increase until June 26, 1992. In the meantime three parties, the Navy, the Energy Council of Rhode Island (TEC-RI), and the Rhode Island Department of Economic Development (DED), individually filed motions with the commission to intervene in the rate proceedings. All three motions were timely and were granted. On June 16, 1992, the commission again issued an order suspending the phase 1 implementation for three months to September 26, 1992, with a report to issue on the next business day, September 28, 1992.

The company is a wholly owned subsidiary of Eastern Utilities Associates. The company serves approximately 31,000 customers, of which approximately 27,000 are residential. Its largest customer is the Navy, which takes approximately 20 percent of its load. The service area covers fifty-five square miles, providing electrical service to Aquidneck, Conanicut, and Prudence Islands which includes the city of Newport and the towns of Middletown, Portsmouth, and Jamestown. The company generates its own power obtained from a jointly owned facility and purchases power, either directly or indirectly, from supply contracts with other New England utilities.

Hearings on the proposed rate change began in April of 1992 and extended through May of that year, where all the parties including the intervenors had opportunity to present testimony. Three separate stipulations that together addressed all aspects of the company's filing, were entered into by the various parties. The first stipulation (stipulation 1) pertained to the company's revenue requirements and was agreed to by the company, the Division of Public Utilities and Carriers and the Attorney General of Rhode Island (collectively the division), and the Navy on May 18, 1992. It provided that "Newport's Phase I rates shall be revised to increase annual revenues by $3,660,000, and an increase of 6.6%." Stipulation 1 was a modification of the original revenue sought, $6,093,664.

The second stipulation (stipulation 2) pertained to rate class revenue requirements. The third stipulation (stipulation 3) pertained to rate design. Both stipulation 2 and stipulation 3 were agreed to by the company, the division, and TEC-RI on May 29, 1992. The Navy refused to enter either of these two stipulations. The DED did not enter into any of the three stipulations. Public hearings were continued in June to consider the various issues surrounding the proposed increase. Briefs were filed by the parties and reviewed by the commission. The commission reopened hearings on September 8, 1992, to consider additional issues. Finally on September 28, 1992, as scheduled, the commission released its report and order approving phase 1 of the rate increase.

The commission ultimately accepted the three separate stipulations in its report and order. Stipulation 1 is not being contested in this case. The Navy is not challenging the company's entitlement to additional revenue but rather the increased rates imposed on it in order to achieve that additional revenue. Stipulation 2 and stipulation 3, neither of which the Navy entered as a party, were intended to resolve matters relating to rate class and rate design. The Navy argues that the commission's acceptance of these stipulations was unfair, unlawful, and discriminatory.

The Navy is seeking our review on three issues, one procedural and two substantive. The procedural issue, which, we shall address first, is whether the Navy is entitled to the issuance of a common-law writ of certiorari. The second issue relates to the propriety of the rate increase imposed on the Navy in phase 1. The third issue pertains to the commission's modifications to the contract between the Navy and the company in the redesigned Navy rate.

We conclude that the Navy is entitled to the issuance of a common-law writ of certiorari because of the commission's highly inappropriate interference in the contract between the Navy and the company. We agree to review the entire case for that extraordinary reason alone.

I

Judicial review of decisions and orders of the commission are governed by § 39-5-1. The relevant portions of that statute provide:

"Any person aggrieved by a decision or order of the commission may, within seven (7) days from the date of the decision or order, petition the supreme court for a writ of certiorari to review the legality and reasonableness of the decision or order. * * * The procedure established by this chapter shall constitute the exclusive remedy for persons and companies aggrieved by any order or judgment of the commission."

We have held that a failure to petition for a writ of certiorari within seven days of the date of the order, as required by § 39-5-1 renders the findings of the commission nonreviewable. Interstate Navigation Co. v. Burke, 465 A.2d 750, 755 (R.I.1983). The period for filing a statutory petition for certiorari under § 39-5-1 cannot be extended.

This court, however, "has exclusive jurisdiction to issue a common-law writ of certiorari on occasions in which available remedies are inadequate to safeguard a litigant from substantial harm or injustice." Ratcliffe v. Coastal Resources Management Council, 584 A.2d 1107, 1110 (R.I.1991). The Navy argues that this case presents one of those occasions in which common-law certiorari is appropriate.

The circumstances in which this court will grant a common-law petition for certiorari are set forth in Barletta v. Kilvert, 111 R.I. 485, 304 A.2d 353 (1973):

"Under our cases certiorari does not ordinarily lie where another adequate remedy is available whereby the applicant's rights can be reviewed and determined by this court, nor where the petition seeks a review of an interlocutory order nor where to grant certiorari will result in bringing a matter before us in piecemeal fashion. This is the rule which has been followed in this state for many years, except where it is shown that unusual hardship or exceptional circumstances would void the benefits of an otherwise adequate remedy at law." Id. at 487, 304 A.2d at 354-55 (citing Shiller & Schwerin v. Gemma, 106 R.I. 163, 256 A.2d 487 (1969); Rogers v. Rogers, 98 R.I. 263, 201 A.2d 140 (1964)).

In Eastern Communications Corp. v. Burman, 121 R.I. 311, 397 A.2d 1317 (1979), we determined that § 39-5-1 presents an adequate remedy at law under the standards pronounced in Barletta v. Kilvert for review of commission decisions and orders. Burman, 121 R.I. at 315, 397 A.2d at 1319. Although we stated in Burman that failure to receive notice of a commission order may "[render] inadequate the otherwise adequate remedy provided by § 39-5-1," the Navy, in this case, has not claimed that it did not receive notice of the issuance of the report and order. Id. Instead the Navy argues that it did not receive a copy of the report and order until after the appeal period had expired.

It is undisputed that the Navy failed to file its petition for a writ of certiorari within seven days of the September 28 report and order. The Navy argues that it did not receive the report and order until after the seven-day appeal period had expired and that it would be "patently unfair" to require a party to file a petition for a writ of certiorari prior to receiving the decision on which such a petition would be based. We disagree with this argument.

The Navy was on notice throughout the entire rate-docket proceeding regarding the statutory time constraints governing the issuance of the commission's report and order. On June 26, 1992, the commission issued an order indicating that the phase 1 rate implementation would be delayed until September 26, 1992, with a report and order to follow on September 28, 1992. It is well settled that "[t]he mandate of § 39-3-11 is that the commission not take longer than eight months to decide on the original filed rates." Providence Gas Co. v. Burke, 475 A.2d 193, 196 (R.I.1984). The initial filing for the proposed rate change was December 27, 1991, to be effective January 27, 1992. The eight-month deadline for the...