W. v. Byron
| Decision Date | 08 July 1927 |
| Parties | WEST et al. v. BYRON et al. No. 52. |
| Court | Maryland Court of Appeals |
WEST et al.
v.
BYRON et al.
No. 52.
Court of Appeals of Maryland.
July 8, 1927.
Appeal from Circuit Court of Baltimore City; H. Arthur Stump, Judge.
Proceeding by Joseph C. Byron and others against Harold E. West and others, constituting the Public Service Commission of Maryland. Decree for plaintiffs, and defendants appeal. Reversed and remanded, with directions.
Argued before BOND, C. J., and PATTISON, URNER, ADKINS, OFFUTT, DIGGES, and PARKE, JJ.
William D. Rawls, of Baltimore (Thomas H. Robinson, Atty. Gen., and J. Hubner Rice, Asst. Atty. Gen., on the brief), for appellants.
Alexander Armstrong, of Hagerstown, and Francis J. Carey, of Baltimore (Piper, Carey & Hall, of Baltimore, and Wm. P. Lane, Jr., of Hagerstown, on the brief), for appellees.
PARKE, J. The proceedings in this cause were begun in the circuit court of Baltimore City by six residents, taxpayers, purchasers, and consumers of electricity in the municipality of Hagerstown, and by the Potomac Edison Company, a public service corporation incorporated by the state of Maryland, which is engaged in the selling and distributing of electric power and current to the public in the municipality and elsewhere, and which is a taxpayer to the municipality. The six individuals instituted the proceedings, not only on their own behalf, but also on that of all other purchasers and consumers and taxpayers in like situation. The defendants are Harold E. West, J. Frank Harper, and Ezra B. Whitman, in their official capacity as the persons constituting the Public Service Commission of Maryland. The bill of complaint was founded on these allegations of fact. The municipality owns and operates a municipal electric plant by which the streets and public places of Hagerstown are lighted, and electric current is distributed and sold to the public in the municipality. On July 28, 1923, the municipality applied to the commission for a certificate of authority to build, maintain, and operate a new 3.000 kilowatt electric plant at an approximate cost of $300,000; and for authority to issue bonds whose principal amount would be $300,000. Upon the protest of the Potomac Edison Company and other taxpayers of the municipality, and after hearings and investigation, the commission filed on December 31, 1923, an opinion and order refusing the petition. The reasons assigned in the opinion for this action were that the commission found that the Potomac Edison Company's plant provided Hagerstown with an ample and abundant supply of electric current and gave it assurance, under regulation by the commission, of adequate and continuous service
at reasonable rates so that the construction by the municipality of the projected new plant would be a wasteful duplication of facilities.
On April 9, 1926, the municipality renewed its former application, and, by an amendment filed to its second petition, increased its estimate of the approximate cost of the plant to $425,000. The second petition and its amendment were in the form of independent and original proceedings, but the protests filed disputed the right of the municipality to make the second application on the ground that it was a rehearing and that no reason was assigned for a rehearing as required by section 11 of the Public Service Commission Law (Code, art. 23, § 359), and by section 8 of the Rules of Practice and Procedure of the commission. The protestants also resisted the granting of the authorization sought because the proposed new plant was not necessary nor as convenient for the public service. The commission dismissed the objection to the form of procedure and proceeded to a hearing of the parties in interest, at which testimony was presented by the litigants.
The bill of complaint averred that no evidence was introduced tending to show that the construction of the proposed plant would in any manner improve the character or increase the extent or economy of the electric service available in Hagerstown, or that such construction was necessary or convenient for the public service, but that the uncontradicted evidence did show that the company was rendering safe, adequate, and sufficient electric service at just and reasonable rates, and this it was ready, able and willing to continue with its existing facilities, which were ample to take care of the increasing electrical demand within the ensuing five years.
On this state of the proof the commission is charged with not finding the construction of the new municipal plant necessary or convenient for the public service, but nevertheless authorizing, on September 29, 1926, the work to be done and the bonds to be issued. Both on account of the alleged absence of evidence and of the failure of the commission to find the building of the plant necessary or convenient for the public service, the complainants maintain the order was unreasonable and unlawful and its consequences prejudicial to the rights and interests of the complainants as taxpayers and of the Potomac Edison Company as a public utility already in the same field and prepared to furnish adequate service. On these allegations and grounds, the complainants prayed that the order of the Public Service Commission of September 29, 1926, be vacated and set aside, and that they have general relief.
On the petition of the commission the chancellor passed an order nisi making the mayor and council of Hagerstown a party defendant, and the municipality later appeared solely for the purpose of denying jurisdiction on the ground that although admitting the municipality was a necessary party, yet the municipality, being located in Washington county, could not be made subject to the process of any court other than those of Washington county in respect to the matters in controversy. The plaintiffs demurred to the defendant's petition that the municipality be made a party defendant upon the theory that under the statute the commission was the defendant authorized.
By express leave of the court the commission filed its combined demurrer and answer, which, while replying to all the allegations of the bill of complaint, reserved its point of the legal insufficiency of the bill of complaint.
The chancellor overruled the demurrer to the bill of complaint and sustained the demurrer to the petition of the commission asking that the mayor and council of Hagerstown be made a codefendant, and these rulings raise the two questions, Was the municipality a necessary party defendant? and was the cause properly begun before a judge of the Supreme Court of Baltimore City in the circuit court of Baltimore City?
1. Since the action is not of common-law origin but of purely legislative creation, an answer to both inquiries must be sought in the statutory law.
By the Public Service Commission Law, § 11 (Code, art. 23, § 359), the right is given to any company, corporation, association, person, or partnership, subject to any of the provisions of the act, or any other person or party in interest, to proceed in the courts to vacate, set aside, or have modified any order of the commission on the grounds that such order is unreasonable or unlawful, and that the right so conferred shall be exercised in the manner as particularly set forth in a later section. The section to which reference is thus made was section 43 of the act as now embodied in section 404 of article 23, and its most pertinent paragraphs follow:
"404. Any corporation subject to this subtitle, or any of the provisions of this subtitle, and any person in interest being dissatisfied with any order of the Commission, fixing any rate or rates, tolls, charges, schedules, joint rate or rates, or any order fixing any regulations, practices, acts or service, may commence any action in the circuit court for any county, or before any judge of the supreme bench of Baltimore City, in any court of Baltimore City of appropriate jurisdiction which may be adopted for the purpose, against the commission as defendant to vacate and set aside any such order on the ground that the rate or rates, tolls, charges, schedules, joint rate or rates, fixed in such order is unlawful, or that any such regulation, practice, act or service fixed in such order is unreasonable, in which action a copy of the complaint shall be served with the summons.
"The answer of the commission to the complaint shall be served and filed within twenty days after service of the complaint, whereupon said action shall be at issue and stand ready for trial upon fifteen days' notice to either party.
"All such actions shall have precedence over any civil cause of a different nature pending in such court, and the said courts shall always be deemed open for the trial thereof, and the same shall be tried and determined as other civil actions."
While any corporation subject to the provisions of the statute or any person in interest may become plaintiff, the language of the statute plainly prescribes the commission as the only necessary defendant.
The proceedings authorized are confined to the orders of the commission, and the grounds of attack are limited either to their unlawfulness or to their unreasonableness, and any redress sought is against the commission since it alone had the power to pass the objectionable order. The relief obtainable is consequently from the action of the commission in the exercise of an indivisible power to pass lawful and reasonable orders in the performance of its statutory duties. If any corporate or private interest is adversely affected, it may attempt to enforce its position under the section cited, and hence its failure so to proceed is an indication of satisfaction or acquiescence in the order, which by statute will not be set aside or changed unless in the authorized action its opponent shall show by clear and satisfactory evidence that the order complained of is unlawful or unreasonable. Code, art. 23, § 408. This presumption of the lawfulness and...
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