Williams v. Public Service Com'n of Utah, s. 19867
| Decision Date | 04 March 1986 |
| Docket Number | 19873,Nos. 19867,s. 19867 |
| Citation | 720 P.2d 773 |
| Parties | David R. WILLIAMS, dba Industrial Communications, Petitioner, v. The PUBLIC SERVICE COMMISSION OF UTAH, Brent H. Cameron, Chairman; David R. Irvine, Commissioner; James M. Byrne, Commissioner, Respondents. MOBILE TELEPHONE, INC., a corporation, Petitioner, v. The PUBLIC SERVICE COMMISSION OF UTAH, Brent H. Cameron, Chairman, David R. Irvine, Commissioner, James M. Byrne, Commissioner, Respondents. |
| Court | Utah Supreme Court |
Keith E. Taylor, F. Robert Reeder, Michael L. Larsen, Brinton R. Burbidge, Salt Lake City, for petitioner.
David L. Stott, Stuart L. Poelman, Salt Lake City, for intervenor Amer. Paging.
Stephen R. Randle, Salt Lake City, for Page Amer.
David L. Wilkinson, Atty. Gen., Craig Rich, Asst. Atty. Gen., Salt Lake City, for respondents.
Petitioners Industrial Communications and Mobile Telephone, Inc., appeal from an order of the Utah Public Service Commission ("Commission") holding that the Commission has no authority to regulate one-way mobile telephone paging services. Petitioners allege, inter alia, that the Commission did not follow proper administrative procedures in concluding that it lacked jurisdiction. We agree that the Commission failed to adhere to proper requirements in ruling on the jurisdictional issue, and accordingly reverse and remand for a new hearing that comports with the applicable statutes.
Understanding the history of the Commission's assertion of regulatory authority over one-way paging services is important to this case. In 1962, the Commission granted a certificate of public convenience and necessity to operate both a two-way mobile telephone system and a one-way paging service to petitioner Mobile Telephone, Inc. By this action, and without objection from any party, the Commission assumed jurisdiction over both one-way paging and two-way mobile telephone services under sections 54-2-1(21), (22), and (30) of the Code. 1 Between 1962 and 1983 the Commission granted similar dual authority certificates to three other companies. In 1974, the Commission granted to Mobile Telephone of Southern Utah, Inc., a single authority certificate covering only one-way paging service. From the record, it appears that the Commission has, on occasion, denied requests for certificates for one-way paging authority. Until 1983, however, the Commission's authority to regulate one-way paging services was not questioned.
In the early 1980's, the Federal Communications Commission deregulated radio frequencies for use in paging services. Sixty-nine channels were made available in Utah on a first-come, first-served basis. 2 Page America, Inc., American Paging, Inc., and United Paging Corporation each received a permit from the Federal Communications Commission to operate on one of the new frequencies early in 1983. 3 In May of 1983, American Paging's attorney contacted Commissioner Irvine to inquire whether American Paging could operate a one-way paging system without a certificate. At the request of this attorney, Commissioner Irvine discussed the issue with the other commissioners. Thereafter, the Commission sent a letter to the attorney for American Paging, dated June 3, 1983, stating that in the Commission's opinion, no certificate was required. It added that the Commission would not request a hearing on the issue. 4 That letter is the basis of the controversy here.
In August of 1983, Page America applied for a certificate to operate a paging service; petitioner Industrial Communications protested the application. The Commission scheduled a public hearing on the application for December of 1983, indicating its desire to "review" its jurisdiction over one-way paging services. Page America later moved for a determination that it was exempt from regulation. The Commission scheduled a hearing on that motion for November 7th.
Meanwhile, American Paging had begun operations without a certificate in reliance on the Commission's June letter declining to exercise jurisdiction. Industrial Communications therefore asked the Commission to issue a cease and desist order to stop American Paging from operating without a certificate. A hearing on the cease and desist request was held October 24, 1983. At that hearing, the Commission admitted it was in a dilemma inasmuch as it had "contradicted itself somewhat by the issuance of the June 3rd, 1983 letter." The Commission refused to order American Paging to stop operations; however, it ordered American Paging not to accept new customers until after the November hearing on Page America's certificate at which the jurisdictional issue would be reviewed.
Following the November hearing, the Commission formally ruled that it had no jurisdiction to regulate one-way paging services, effectively deregulating that field. The Commission dismissed Page America's application for a certificate and cancelled the certificates of Industrial Communications and Mobile Telephone, Inc., to the extent they authorized one-way paging services. It also cancelled the certificate granted to Mobile Telephone of Southern Utah, Inc., authorizing the operation of a one-way paging system. 5
After the ruling, Industrial Communications, which had opposed deregulation, sought a reversal of the Commission's order and a disclosure of ex parte communications relating to the jurisdictional issue. It also moved for a rehearing before a commission pro tempore, claiming that by virtue of the June letter to American Paging, the Commission had prejudged the jurisdictional issues. 6 The Commission acknowledged the June letter and the contacts leading up to it, but refused to set aside its order for any reason. On appeal, Industrial Communications and Mobile Telephone, Inc., challenge the Commission's actions.
The principal procedural point raised by petitioners is that the Commission's June letter effectively operated to relinquish the Commission's jurisdiction over one-way paging, and stripped petitioners and their similarly situated competitors of a valuable property right--their certificates. Petitioners argue that under the provisions of the Utah Administrative Rule Making Act, the hearing provisions of the Public Service Commission Act, and the due process clauses of state and federal constitutions, the June letter constituted a de facto rule making which required that all interested parties be given proper notice and an opportunity to be heard. See U.C.A., 1953, § 63-46-5 ; U.C.A., 1953, § 54-7-13 (Repl. Vol. 6A, 1974); Utah Const. art. I, § 7; and U.S. Const. amend. XIV.
We first inquire whether the Commission's actions complied with the procedural requirements of the statutes governing agency rule making or agency adjudication. Any state agency promulgating a rule must follow the procedures specified in that act. U.C.A., 1953, § 63-46-1 (2nd Repl. Vol.7A, 1978). 7 A rule is defined as a "statement of general applicability ... that implements or interprets the law or prescribes the policy of the agency in the administration of its functions...." U.C.A., 1953, § 63-46-3(4) . The Public Utilities Act, also relied on by petitioners, requires that the Commission give notice and hold a hearing before it alters, amends, or rescinds an order or decision. U.C.A., 1953, § 54-7-13 (Repl. Vol. 6A, 1974). Petitioners claim that the procedural requirements of at least one of these statutes apply here because the June letter constituted either a "rule" within the meaning of the Rule Making Act, or an "order" within the meaning of the Public Utilities Act.
The Commission argues that the June, 1983, letter was not a rule making within the meaning of the Utah Rule Making Act because it did not have general applicability. The Commission also argues that because it had never formally determined that it had jurisdiction to regulate paging services under the Public Utilities Act, it was free to announce its opinion on the subject without any procedural formalities. There is no merit to the Commission's arguments.
As an initial matter, we note that the Utah Administrative Rule Making Act seems most directly on point here. It deals in some specificity with matters that the Public Utilities Act covers only inferentially, and the Rule Making Act's provisions do not appear inconsistent with the earlier enacted utility statute.
The pivotal question is whether the decision announced by the Commission in the June letter amounted to a rule. It might be argued that the Commission's action here is merely legitimate law development through adjudication as opposed to rule making. We acknowledge that there is a variance of opinion on when an agency is engaged in rule making and must follow formal rule making procedures, and when an agency may legitimately proceed by way of adjudication. See, e.g., NLRB v. Wyman-Gordon Co., 394 U.S. 759, 89 S.Ct. 1426, 22 L.Ed.2d 709 (1969); and NLRB v. Bell Aerospace Co., 416 U.S. 267, 94 S.Ct. 1757, 40 L.Ed.2d 134 (1974). However, we think that there are some fundamental points of reference in this area of the law that are of assistance in determining whether the Commission should have proceeded by formal rule making. Professor Davis summarized some of these considerations.
Although a retroactive clarification of uncertain law may be brought about through adjudication, according to [SEC v. Cheney Corp., 332 U.S. 194 [67 S.Ct. 1575, 91 L.Ed. 1995 (1947) ] and its many progency ..., the problem may be different when an agency through adjudication makes a change in clear law, as when it overrules a batch of its own decisions, especially if private parties have acted in reliance on the overruled decisions.
2 K. Davis, Administrative Law Treatise § 7:25, at 122 (2d ed. 1978). Interpreting the definition of "rule" contained in section 63-46-3(4), in light of these considerations, leads us to the conclusion that the Commission was engaged in rule making and had...
To continue reading
Request your trial
-
Plateau Min. Co. v. Utah Div. of State Lands and Forestry
...interpretation and attempted application of the lease provision at issue does not amount to rulemaking. See Williams v. Public Serv. Comm'n, 720 P.2d 773, 776-77 (Utah 1986). A comparison to federal law is useful on this point. In Shell Offshore Inc., 115 IBLA 205 (July 3, 1990), the Minera......
-
Utah Chapter Of The Sierra Club v. Air Quality Bd.
...rulemaking is required under the statute, we focus our attention on whether an agency action amounts to a rule. Williams v. Pub. Serv. Comm'n, 720 P.2d 773, 776 (Utah 1986).13 Defined both statutorily and in case law, a rule is a policy or statement that is generally applicable, implements ......
-
Mountain Fuel Supply Co. v. Public Service Com'n of Utah
...dissenting). Of course, certain agency decisions setting policy must be made by formal rule making. See, e.g., Williams v. Public Serv. Comm'n, 720 P.2d 773, 776-77 (Utah 1986). In the instant case, however, Mt. Fuel does not claim that the Commission should have promulgated its preference ......
-
Ellis v. Utah State Retirement Bd.
...agency subject to the Administrative Rulemaking Act promulgating a rule must follow the procedures specified. See Williams v. Public Serv. Comm'n, 720 P.2d 773, 775 (Utah 1986) (interpreting the Utah Rule Making Act, the predecessor to the Administrative Rulemaking Act). The Administrative ......