Wis. Power & Light Co. v. Pub. Serv. Comm'n

• Decision Date: 07 March 1939
• Citation: 284 N.W. 586,231 Wis. 390
• Court: Wisconsin Supreme Court
• Parties: WISCONSIN POWER & LIGHT CO. v. PUBLIC SERVICE COMMISSION et al.

231 Wis. 390

284 N.W. 586

WISCONSIN POWER & LIGHT CO.

v.PUBLIC SERVICE COMMISSION et al.

Supreme Court of Wisconsin.

March 7, 1939.

Appeal from a judgment of the Circuit Court for Dane County; August C. Hoppmann, Judge.

Reversed.

This action was begun on May 28, 1936, by the Wisconsin Power & Light Company, a Wisconsin corporation, plaintiff, to review an order of the Public Service Commission, defendant. On August 13, 1936, the city of Edgerton was made a party defendant although the plaintiff seeks no relief as against it. The action was brought to set aside an order of the Commission dated September 10, 1935, and to vacate, set aside, alter and amend the order of the Commission dated March 30, 1936, fixing just compensation for the plaintiff's property. From the judgment entered on the 2d day of June, 1938, affirming both orders, the plaintiff appeals.

A brief outline of the facts is as follows: On June 27, 1933, the electors of the city of Edgerton at a special election voted to purchase the rights and property of the plaintiff actually used and useful for transmission, delivery and furnishing of heat, light and power within the city of Edgerton. Thereafter the Public Service Commission gave notice of a hearing upon the matter of just compensation to be paid for the property and fixing the terms and conditions of purchase and hearings were held in Madison on December 7, 8 and 9, 1933, January 25, 1934, and February 1, 1934. On September 10, 1935, the Public Service Commission made an award fixing the just compensation for the property taken, including going value, in the sum of $90,000. In its order the Commission stated that the determination of just compensation had been necessarily delayed until there was a determination by the Supreme Court in the Brooklyn Case, Wisconsin P. & L. Co. v. Public Service Comm., 1935, 219 Wis. 104, 261 N.W. 711, 262 N.W. 257. The plaintiff applied to the commission for a rehearing. Application was granted and a rehearing was held November 14, 1935, January 15, 1936, and February 17, 1936. On March 30, 1936, the Commission made its award based upon the testimony including that submitted on the rehearing and fixed just compensation at $95,000. On May 28, 1936, the plaintiff commenced an action to review the orders of the Commission. It was at this point that the city of Edgerton was impleaded as a party defendant.

The case came on for trial in the circuit court on June 3 and the trial continued to June 17, 1937. The Company introduced additional evidence and the trial court being of the view that the evidence introduced was different and additional to that offered before the Commission, transmitted the record to the Commission for reconsideration. At this point the plaintiff requested the Commission to make the following findings which are set out in the margin for the reason that the request discloses the basis of the controversy between the parties to this action.¹

The Commission declined to alter or amend its order of September 10, 1935, as amended by the order on rehearing dated March 30, 1936, and on November 15, 1937, so reported to the Court. In this connection and in response to the request of the plaintiff the Commission stated with respect to the first three requests which relate to the date or dates determining just compensation, that the Commission did not consider it would be proper to make any finding in compliance with such requests; that insofar as the Commission determined just compensation by the orders under review, such just compensation was intended by such orders to be equivalent to the value of the property, as that value was on or about June 27, 1933.

The Commission further stated in its report that the sum of $95,000 was substantially the value of the property as of the date when the city of Edgerton determined to acquire it, that is, June 27, 1933.

The Commission further stated in its report that the final order makes provision for the determination of the value of general equipment, materials and supplies on hand on the date of payment of just compensation and also for the value of net additions to or net retirements from said property on the same date and determines that just compensation for all property, subject to acquisition to be the sum of $95,000 plus the value of such general equipment, materials and supplies and less or plus the value of additions to or retirements from the property as such value may be determined to be as of the date of payment of such just compensation.

The Commission further stated in response to the request of the plaintiff for specific findings with respect to disputed evidentiary facts that the Commission never at any time made any determination with respect to any of such disputed facts; that in determining the amount of depreciation, it did not use the life and age method; that it did not determine the average life for the various kinds of public utility property and declined to make findings relating to that matter; that the Commission did not determine any sum as properly included in the amount of just compensation on account of engineering supervision, etc., and declined to make any finding with respect thereto; further, that it made no separate determination of any amount which it considers proper to be allowed on account of the going value and the Commission declined to make any finding with respect to the various matters pertaining to the value of the property subject to acquisition in the proceeding involved, as requested by the plaintiff in the written requests as filed.

Schubring, Ryan, Petersen & Sutherland, of Madison, for appellant.

John E. Martin, Atty. Gen., Harold H. Persons, Asst. Atty. Gen., H. T. Ferguson, Spec. Asst. Atty. Gen., Stanley W. Slagg, of Edgerton, and Orland S. Loomis, of Mauston, for respondents.

ROSENBERRY, Chief Justice.

The Commission fixed the value of the property which the city of Edgerton had determined to take under the statute as of June 27, 1933, the time of holding the special election at which the electors voted to acquire the utility. It is the contention of the plaintiff that there has been a marked rise in the principal items which go to make up utility property, to-wit: poles, copper wire, base materials and transformers, since June 27, 1933. The plaintiff contends that if such increase in the value of materials and price of labor be given effect, the value of the property taken would increase between June 27, 1933, and October 15, 1935, in the sum of $16,251 and that if effect be given to the increase in the price of labor and materials, an increase in valuation to May 15, 1937, is $31,393. It is apparent that the question as of what date the property should be valued is an important and controlling one. The statute does not expressly provide as of what date the value of the property is to be fixed. When a municipality has determined to acquire a public utility and has given the statutory notice thereof, section 197.05 provides: “The commission shall thereupon set a time and place for a public hearing upon the matters of the just compensation to be paid for the property of such public utility, wheresoever situated, actually used and useful for the convenience of the public and of all other terms and conditions of the purchase.”

At the close of the hearing provided for by statute “The commission shall by order fix and determine and certify *** just compensation to be paid for the taking of the property of such public utility actually used and useful for the convenience of the public and all other terms and conditions of purchase which it shall ascertain to be reasonable.”

Section 197.05(3) provides: “Upon the filing of such certificate with the clerk of such municipality the absolute title of the property taken shall vest in such municipality”.

In this case the certificate which the commission is required to make and file in accordance with the provisions of sec. 197.05(3) has never been filed with the clerk of the municipality. The order of September 10, 1935, provides: “It is further ordered that upon evidence being presented to this Commission of the paymentof the amount herein required to be paid as and for just compensation for the purchase of the property of the Wisconsin Power & Light Company by said city of Edgerton, to the person or to persons lawfully entitled thereto or to a proper court for their benefit as above provided, a certificate of the Commission of such just compensation and terms and conditions and of the payment and fulfillment thereof, be issued and filed in the manner prescribed by law.”

While the Commission says that the determination as set forth in the original order will be superseded and set aside by the findings and by the order and determination made after the rehearing, in some respects at least the two determinations supplement each other. In its second determination, the Commission says: “We have considered that reproduction cost new should be based upon prices as of a time as near as may be possible when the city by its vote determined to acquire the property involved.”

It also said: “We think that any evidence of the reproduction cost new of such property should be based upon prices prevailing at the time of the exercise of that option as far as practically possible.”

It appears from a consideration of both determinations made by the Commission that the Commission fixed just compensation as near as possible as of the date when the municipality voted to acquire the used and useful property of the utility.

A determination as to the time as of which the property should be valued requires us to give some further consideration to the nature of the proceeding under ch. 197 relating to municipal acquisition of utilities. In spite of all that the Court has said over a period of twenty years, the Commission continues to treat the transaction provided for by the statute as a purchase.

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