Village of North Palm Beach v. Mason

• Decision Date: 06 July 1966
• Docket Number: No. 34784,34784
• Citation: 188 So.2d 778
• Parties: VILLAGE OF NORTH PALM BEACH, a municipal corporation in Palm Beach County, Florida, Petitioner, v. Edwin L. MASON, Jerry W. Carter and William T. Mayo, as and constituting the Florida Railroad and Public Utilities Commission; and North Palm Beach Utilities, Inc., Respondents.
• Court: Florida Supreme Court

Page 778

188 So.2d 778

VILLAGE OF NORTH PALM BEACH, a municipal corporation in Palm Beach County, Florida, Petitioner, v. Edwin L. MASON, Jerry W. Carter and William T. Mayo, as and constituting the Florida Railroad and Public Utilities Commission; and North Palm Beach Utilities, Inc., Respondents.

No. 34784.

Supreme Court of Florida.

July 6, 1966.

Nason & Gildan, West Palm Beach, for petitioner.

Lewis W. Petteway and James L. Graham, Jr., Tallahassee, for respondent Florida Public Service Commission.

Robert M. Ervin of Ervin, Pennington, Varn & Jacobs, Tallahassee, and Starr W Horton, Miami, for respondent North Palm Beach Utilities, Inc.

O'CONNELL, Justice.

On the first appearance of this cause we entered an opinion reported under the same style as this one at 167 So.2d 721. We there concluded that we could not answer one of the questions presented because of insufficient findings of fact as to that question in the order. For that reason we quashed Order No. 3546 and remanded it to the commission.

Because the history of the cause is fully detailed in our first opinion, it is only necessary that we relate what has occurred after it was entered. On return of this cause to it, the commission quite reasonably concluded that we had held its Order No. 3546 to be deficient in findings of fact only as to the question of the valuation of contributed property. Therefore, on January 28, 1965, the commission entered its Order No. 3546--A, in which it made the following findings of fact and conclusions of law:

'That the appraised value, less depreciation, of the water and sewer plant of the Applicant, as evidenced by the engineering report and as corrected in Exhibit 28 by deletion of the construction work in progress which did not constitute used and useful plant, was $1,227,864.48 for the water plant and $1,254,076.90 for the sewer plant as of July 15, 1959; that such appraised value figures included the appraised value of utility plant acquired by the Applicant at no cost to it as contributions in aid of construction; that the appraised value of such contributions was properly included in determining the fair value of the water and sewer plant in service as of July 15, 1956; that contributions in aid of construction as to the water plant in the amount of $160,459.57 and as to the sewer plant in amount of $161,748.65 were received after July s5, 1959, and should be excluded in determining the rate base upon which a return will be allowed; and that such treatment of contributions in aid of construction is in accord with the requirements of Section 367.14(7), Florida Statutes (F.S.A.), and the Opinion of the Florida Supreme Court in the City of Plantation vs. Mason, Fla.1964, Case No. 32854 (170 So.2d 441).'

Order No. 3546--A then concluded:

'ORDERED by the Florida Public Utilities Commission that its Order No. 3546, entered in this Docket on March 13, 1963, and not thereafter superseded during the above described litigation be and it is hereby continued in full force and effect.'

It is this Order No. 3546--A which is now before us for review.

The petitioner village presents three questions which we paraphrase as follows: (1) whether an order of this court quashing a rate order, because of insufficient findings of fact, makes such new rates void ab initio so as to prevent the commission from thereafter continuing the quashed order in effect as it did in this case; (2) whether the commission erred in accepting the appraised fair value of the property contributed in aid of construction prior to July 15, 1959 without considering that the property was acquired by the utility without cost; and (3) whether Order No. 3546--A was not also fatally defective for failure to include sufficient findings of fact and conclusions of law.

The third question is without merit. Considered together with Order No. 3546 the subject order makes adequate findings of fact.

The second question is also baseless. In City of Plantation v. Mason, Fla.1964, 170 So.2d 441, we held that the fair appraised value of property contributed in aid of construction prior to the effective date of ch. 367, as reflected by the engineering report required by F.S. Sec. 367.12(2), F.S.A, is properly included in the rate base of a utility. In City of Margate v. King, Fla.1965, 167 So.2d 852, we explained that the value fixed in the engineering report is not sacrosanct and may be adjusted by the commission on its own investigation and hearing or on evidence submitted by the parties.

The petitioner village does not contend that the contributed property should not be considered in determining the rate base. It only argues that in determining the value of such property, the commission ought to have taken into account that it was acquired at no cost to the utility.

We do not understand that the village offered, or that the commission refused to allow, introduction of evidence relating to the fair value of the questioned property. The commission simply ruled that the fact the property was contributed had no relevance to its fair value. The commission was correct. The statute permits such property to be included in a rate base at the fair value shown by the engineer's report as it may be modified by evidence received by the commission. The fact that the utility paid nothing for this property acquired prior to the effective regulatory date does not affect the fair value of the property and is not a factor to be weighed in the determination thereof. For example, if the...