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concluding that "Ohio law abounds with precedent to the effect that constitutional issues should not be decided unless absolutely necessary"
Summary of this case from Ohio Public Emp. Retire. Sys. v. CoursenOpinion
No. 76-1040
Decided June 15, 1977.
Public Utilities Commission — Entry on application for surcharge — Appeal premature, when — "Substantial right" not affected.
APPEAL from the Public Utilities Commission.
The diminishing supplies of natural gas during the 1975-1976 winter season gave rise to this cause. Faced with a shortage of natural gas, Columbia Gas of Ohio, Inc. (Columbia), made an emergency purchase of gas, pursuant to the Federal Power Commission's Rules and Regulations, 18 C.F.R., Section 2.68. By this emergency purchase, Columbia was able to reduce the level of curtailment to each class of curtailed customers during the winter of 1975-1976. However, since the price of the emergency purchase, under Section 2.68, is unregulated by the Federal Power Commission, the cost of the emergency gas is generally more expensive than Columbia's normal gas purchases. The Public Utilities Commission of Ohio (commission) approved a method of recovery, whereby Columbia spread the increased cost among all customers. This additional cost was 4.83c Mcf and applied to all volumes of gas billed after February 14, 1976.
Mcf = 1000 cubic feet.
However, the General Assembly possessed a different view on the recovery of the additional cost associated with the purchase of the emergency gas. Apparently believing that only the industrial customers were benefited by the purchase of the emergency gas, since only they would have been curtailed if there were no emergency purchase, the General Assembly, by law, required the burden of the additional cost to be borne only by those who otherwise would have suffered curtailment. (Am. Sub. H.B. No. 1213, R.C. 4905.302, effective April 27, 1976.)
On April 27, 1976, Columbia ceased billing its noncurtailed customers for the cost of the 1975-1976 winter emergency purchases. However, at this time, Columbia had not recovered all the cost incurred in making the emergency purchases. Therefore, Columbia filed an application with the Public Utilities Commission to recover the cost of the emergency purchases by imposition of a surcharge upon all the curtailed customers, claiming its unrecovered cost totalled 11.5 million dollars. Petitions to intervene were filed by Hall China Company et al. (Hall China).
On July 14, 1976, the commission issued an entry dismissing the application, stating that R.C. 4905.302 did not mandate the pricing policy proposed by Columbia, but merely designated the customers to be charged for the emergency purchase. The entry also contained additional findings. Hall China's argument is directed at finding No. 7, which indicates the commission's opinion that the cost of the emergency purchase not yet recovered may be recovered pursuant to R.C. 4905.302.
Pursuant to the July 14, 1976, entry, Columbia filed, on July 26, 1976, a "Notification of Modification" of its existing purchase gas adjustment clause to recover the unrecovered cost relating to the emergency purchase. Under this modification, the rates for the curtailed customers would be increased for gas volumes consumed from August 1, 1976, through April 1977, at which time the cost would be fully recovered.
On August 5, 1976, Hall China filed an application for rehearing, relating to the July 14th order, which was denied on September 1, 1976. Columbia filed a tariff with the commission, on August 13, 1976, to effectuate the July 14, 1976, order.
Meanwhile, on August 11, 1976, the commission approved Columbia's notification of July 26, 1976. Additional applications for rehearing were filed on Columbia's notification, including an application for rehearing by Hall China. On September 8, 1976, the commission "concluded that this matter should be reopened, and that a public hearing should be held." The hearing was held on October 5, 1976, to consider, inter alia:
"when Columbia made the emergency purchases of natural gas * * *;
"when Columbia reduced curtailment as a result of said purchases; and
"to which classes of customers curtailment was reduced as a result of said purchases."
On October 13, 1976, Columbia indicated its willingness to make a refund under certain conditions in the event the collection of the increased charges was determined to be improper. By an entry dated November 8, 1976, the commission approved Columbia's undertaking to secure the possible refund of all amounts collected in connection with the cost of the 1975-1976 winter emergency purchase. The undertaking holds Columbia liable to the state of Ohio if it fails to refund amounts finally determined to have been improperly paid. Upon completion of the administrative hearing, the case was submitted to the commission. The record does not reveal a determination by the commission.
The cause is now before this court upon Hall China's notice of appeal from the commission's order of July 14, 1976, and the August 13, 1976, tariff filing.
Messrs. Steer, Strauss, White Tobias, Mr. Robert J. White, Mr. F. Bruce Abel, Mr. David F. Boehm and Mr. Jay J. Dudley, for appellants.
Mr. William J. Brown, attorney general, Mr. Charles S. Rawlings and Mr. Samuel C. Randazzo, for appellee.
Mr. James L. Fullin, Mr. Roger C. Post and Mr. Thomas J. Brown, Jr., for intervening-appellee Columbia Gas of Ohio, Inc.
An appeal from the Public Utilities Commission to the Supreme Court is predicated upon the finality of the order. In pertinent part, R.C. 4903.13 reads:
"A final order made by the Public Utilities Commission shall be reversed, vacated, or modified by the Supreme Court on appeal, if, upon consideration of the record, such court is of the opinion that such order was unlawful or unreasonable."
R.C. 2505.02 defines "final order" as:
"An order affecting a substantial right in an action which in effect determines the action and prevents a judgment, an order affecting a substantial right made in a special proceeding * * *."
A proceeding before the commission is a special proceeding for the purpose of R.C. 2505.02. Cleveland, Columbus Cincinnati Highway v. Pub. Util. Comm. (1943), 141 Ohio St. 634. Therefore, an order of the commission affecting a "substantial right" of a party is final and appeallable pursuant to R.C. 4903.13. Thus, crucial to the propriety of this appeal is the determination whether a "substantial right" of Hall China has been affected by the commission's entry of July 14, 1976.
Hall China alleges that the July 14, 1976, entry of the commission effectuates, by its interpretation of R.C. 4905.302, the retroactive surcharge of August 1, 1976, thereby prejudicing a substantial right of Hall China. An analysis of the facts and circumstances of this case reveals no effect upon any "substantial right" of Hall China as a result of the entry of July 14, 1976. Although Columbia has proceeded via the increased tariff with the recovery of the cost of the emergency gas from the curtailed customers, including Hall China, Columbia has been required to file an undertaking. The terms of this undertaking protect Hall China and others from loss if, upon the commission's final determination, the contested rates are held invalid or inapplicable. The certainty of the impairment of a "substantial right" caused by the commission's order as found in Cleveland, Columbus Cincinnati Highway v. Pub. Util. Comm., supra, is not presented in this case. In the instant case, the effect upon the "substantial right" of Hall China is clearly contingent upon a final decision by the commission. Until the final decision is rendered, Hall China is protected from loss by Columbia's undertaking.
Furthermore, the constitutional question of retroactivity raised by Hall China relates not to R.C. 4905.302 per se, but is dependent upon the commission's interpretation and application. Since the matter is still under consideration and subject to modification, the commission's final decision may render moot the present question of retroactivity.
Finally, Ohio law abounds with precedent to the effect that constitutional issues should not be decided unless absolutely necessary. State, ex rel. Herbert, v. Ferguson (1944), 142 Ohio St. 496. The necessity is not apparent where both the mootness of the issue of retroactivity and the existence of an effect upon a substantial right are dependent upon the commission's interpretation and application of R.C. 4905.302 in futuro.
The appeal being prematurely and improperly taken from the nonfinal entry of July 14, 1976, the appeal is dismissed.
Appeal dismissed.
O'NEILL, C.J., HERBERT, CELEBREZZE, W. BROWN, STERN, SWEENEY and LOCHER, JJ., concur.
STERN, J., retired, assigned to active duty under authority of Section 6(C), Article IV, Constitution, sitting for P. BROWN, J.