Washington Water Power Co. v. Idaho Public Utilities Commission

• Decision Date: 15 June 1962
• Docket Number: No. 9085,9085
• Parties: The WASHINGTON WATER POWER COMPANY, Applicant-Appellant, v. IDAHO PUBLIC UTILITIES COMMISSION, Grantor-Respondent, and Petrolane Gas Service, Inc., Applicant-Respondent, and Kootenai Gas Utilities, Inc., Applicant-Respondent. Application of BONNER GAS COMPANY, The Washington Water Power Company, Petrolane Gas Service, Inc., Kootenai Gas Utilities, Inc., for a Certificate of Public Convenience and Necessity for Distribution of Natural Gas in Sandpoint, Idaho, and Kootenai Gas Utilities, Inc., Petrolane Gas Service, Inc., The Washington Water Power Company, for a Certificate of Public Convenience and Necessity for Distribution of Natural Gas in Bonners Ferry, Idaho.
• Court: Idaho Supreme Court

Page 409

372 P.2d 409

84 Idaho 341

The WASHINGTON WATER POWER COMPANY, Applicant-Appellant, v. IDAHO PUBLIC UTILITIES COMMISSION, Grantor-Respondent, and Petrolane Gas Service, Inc., Applicant-Respondent, and Kootenai Gas Utilities, Inc., Applicant-Respondent.

Application of BONNER GAS COMPANY, The Washington Water Power Company, Petrolane Gas Service, Inc., Kootenai Gas Utilities, Inc., for a Certificate of Public Convenience and Necessity for Distribution of Natural Gas in Sandpoint, Idaho, and Kootenai Gas Utilities, Inc., Petrolane Gas Service, Inc., The Washington Water Power Company, for a Certificate of Public Convenience and Necessity for Distribution of Natural Gas in Bonners Ferry, Idaho.

No. 9085.

Supreme Court of Idaho.

June 15, 1962.

Carey H. Nixon, Boise, Robert L. Simpson and Alan P. O'Kelly, Paine, Lowe, Coffin, Herman & O'Kelly, Spokane, Wash., for Washington Water Power Co.

Frank L. Benson, Atty. Gen., John B. Kugler, Sp. Asst. Atty. Gen., Boise, for Idaho Public Utilities Commission.

Watt E. Prather, Bonners Ferry, and Robert V. Wills, Long Beach, Cal., for Petrolane Gas Service, Inc.

Darwin Cogswell, Atty. for Sandpoint, amicus curiae.

TAYLOR, Justice.

The appellant The Washington Water Power Company and the respondent Petrolane Gas Service, Inc., along with two others not now involved, were rival applicants for a certificate of public convenience and necessity for the distribution of natural gas in Sandpoint, Bonner county. The applicants will be referred to hereinafter as 'Washington' and 'Petrolane.'

Washington's application was filed in September, 1959. Petrolane filed its application in June, 1960, and simultaneously therewith filed its separate application for a certificate to serve Bonners Ferry in Boundary county, some thirty-four miles to the north. The applications of Washington and another applicant for Sandpoint, were heard by the commission on June 15th and 16th, 1960. Petrolane's application to serve Sandpoint was heard July 21, 1960, and its application, together with that of another applicant, to serve Bonners Ferry was heard September 23, 1960.

March 27, 1961, the commission by order No. 5887 denied the application of appellant and awarded a certificate for the distribution of natural gas in Sandpoint to respondent; and by order No. 5886 it awarded a certificate for service in Bonners Ferry to respondent Petrolane. In order No. 5887 the commission in its conclusion said:

'The evidence submitted by both Petrolane and Washington is the result of through investigations and the application of reliable and reasonable estimates. Both projects are conservative and can be attained, are feasible, and each of the applicants has the ability to finance and construct the proposed systems. Washington's application is for Sandpoint only, while Petrolane has applied for both Sandpoint and Bonners Ferry and in view of our further conclusion hereinafter set forth, we conclude that the application of Washington should be denied and the application of Petrolane should be granted.'

and found:

'That the public interest equires and will continue to require that a Certificate of Public Convenience and Necessity be granted to an applicant who has applied to serve both thee communities of Sandpoint and Bonners Ferry.

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'That The Washington Water Power Company did submit evidence in support of its application that is reliable and reasonable and its estimates are the results of a thorough investigation and the application of current experience; that Washington did not apply to furnish natural gas service to Boners Ferry area and therefore should be denied.'

Up to that time, the commission had assigned separate case numbers and had conducted the hearings treating the applications for service in the two communities as two separate and distinct proceedings and required the applicants to present their proposals, plans and estimates for service in each community separately. No evidence was received on the basis of a combined plan of distribution for both communities. Therefore, the finding of the commission, that the public interest required certification of an applicant who had applied for authority to serve both communities, was not based upon any evidence in the record.

Thereafter, Washington's application for a rehearing was granted and that company then filed its application for a certificate to serve Bonners Ferry. In granting the rehearing the commission announced its purpose 'to determine the feasibility of combined service to the communities of Sandpoint and Bonners Ferry.' At the opening of the hearing, May 25, 1961, the commission on its own motion ordered that the cases involving the two communities be combined into one 'for purposes of the rehearing,' although this was the first hearing on the application of appellant for certificate to serve Bonners Ferry. Further evidence was produced at the rehearing by the rival applicants; after which the commission by its order No. 6010 denied the application of appellant, and granted certification to respondent for both Sandpoint and Bonners Ferry. Thereafter appellant's petition for rehearing was denied and this appeal followed.

In order No. 6010 the commission found and concluded that appellant had not produced evidence on the rehearing that would cause the commission to reverse its findings and previous orders Nos. 5886 and 5887.

It is well settled that findings, conclusions or orders of the Public Utilities Commission based upon facts not appearing in the record of the proceedings before it cannot be sustained. Due process requires that a party to contested proceedings before the commission must be afforded a full opportunity to meet the issues and to test the evidence upon which the commission bases its decision. Action by the commission upon facts which have not been brought on the record and as to which the aggrieved party was not given a full hearing, is a denial of due process. Application of Citizens Utilities Company, 82 Idaho 208, 351 P.2d 487.

Appellant contends the commission by refusing to 'reverse' its findings and decision expressed in orders Nos. 5886 and 5887 (wherein its conclusion was based upon the fact that Petrolane had applied for certification to serve both communities), perpetuated its original error and continued to base its final decision upon facts not of record. Although its findings and conclusions in order No. 6010 could be construed to that effect, a reading of the entire order indicates that the commission did consider and evaluate the evidence produced by the applicants on the rehearing in support of their respective proposals for combined service to both Sandpoint and Bonners Ferry. Appellant was afforded an opportunity to meet the issues and to present all pertinent evidence.

Some of appellant's assignments question the commission's findings and conclusions upon controverted issues of fact, or issues invoking the discretionary authority of the commission. As to these, we regard the rulings of the commission as final.

However, we find irregularities which require further consideration by the commission.

Bonners Ferry is divided by the Kootenai river. The respondent's survey showed there were 495 houses on the south side of the river and 250 to 300 on the north side. Washington proposed to serve residents on both sides of the river, and presented its plan for crossing the river by attaching its pipe to the present highway bridge, estimating the cost of the river crossing at $3800. Petrolane did not propose to serve the area north of the river. Its regional manager, Mr. Lewis, testified his company had not planned a river crossing because it did not consider it feasible to serve the area north of the river at this time. Mr. Randall, the manager of Petrolane's utility department testified:

'I have...