City of Richardson v. Oncor Elec. Delivery Co.
539 S.W.3d 252
| Tex. | 2018Background
- Richardson (a home-rule city) granted a 2006 franchise to TXU/Oncor that incorporated a city ROW ordinance requiring the utility to remove/relocate facilities in public rights-of-way "at its own expense."
- In 2010 Richardson approved widening 32 public alleys requiring relocation of ~150 Oncor poles (the Alley-Relocation Project); Oncor refused to pay.
- While the relocation dispute was pending, Oncor settled an unrelated PUC rate case and Richardson adopted Oncor's PUC-filed tariff by ordinance; the tariff includes pro‑forma section 5.7.8 stating the "Retail Customer, or the entity requesting such removal or relocation, shall pay" relocation costs.
- Richardson sued for breach of the franchise contract; trial court granted Richardson summary judgment. The court of appeals reversed, holding the tariff (a filed rate) controlled. Richardson petitioned to the Texas Supreme Court.
- The Supreme Court held the tariff provision did not conflict with the franchise or common law because it applies to "Retail Customers" (end‑use customers) requesting relocations, not to municipal relocations for public rights‑of‑way; therefore the franchise governs and Oncor must pay.
Issues
| Issue | Plaintiff's Argument (Richardson) | Defendant's Argument (Oncor) | Held |
|---|---|---|---|
| Whether the PUC‑filed tariff provision (§5.7.8) relieves Oncor of franchise obligation to pay alley‑relocation costs | Tariff applies to retail/customer‑requested moves only; franchise and common law/statutes require utilities to pay for public right‑of‑way relocations | Tariff is a filed rate with force of law and, by its adoption, Richardson agreed the tariff supersedes any conflicting franchise terms | Held: Tariff does not unmistakably apply to municipal right‑of‑way relocations; franchise governs, so Oncor must pay |
| Whether the common law/statute requiring utilities to pay relocations extends to alleys | "Street" in statutes should be read to include alleys; common law & statutes permit cities to require utilities to pay relocations in public rights‑of‑way | Language distinguishes "streets" from "alleys," so statutes requiring utility payment do not cover alleys | Held: Within the statutory and home‑rule context, "street" may encompass alleys; municipalities retain authority to require utilities to pay relocations in alleys |
| Whether the franchise's "shall in no way impair" clause yields to the tariff | Franchise clause preserves municipal powers except where a statute speaks with unmistakable clarity; no such clarity here | Tariff is effectively a law (filed rate) and therefore supersedes conflicting franchise provisions | Held: Even if tariff has force of law, it must express unmistakable clarity to override municipal authority; §5.7.8 lacks that clarity here |
| Proper construction of §5.7.8's phrase "Retail Customer, or the entity requesting such removal or relocation" | "Such" ties the payment duty to retail‑customer requests; municipal relocations for public travel are outside this provision | Language is broad enough to include any entity requesting relocation, including municipalities | Held: "Such" refers back to requests by Retail Customers (end‑use customers); third‑party contractor requests fit, but city relocations for public rights‑of‑way do not |
Key Cases Cited
- Sw. Bell Tel., L.P. v. Harris Cty. Toll Rd., 282 S.W.3d 59 (Tex. 2009) (recognizes traditional common‑law rule that utilities bear cost of public right‑of‑way relocations)
- State v. City of Austin, 331 S.W.2d 737 (Tex. 1960) (utilities may be required to remove facilities at their own expense for highway improvements)
- Sw. Elec. Power Co. v. Grant, 73 S.W.3d 211 (Tex. 2002) (filed tariffs approved by agency acquire force and effect of law and govern utility‑customer relations)
- City of Galveston v. State, 217 S.W.3d 466 (Tex. 2007) (home‑rule municipal powers are limited only where statute speaks with "unmistakable clarity")
- R.R. Comm'n of Tex. v. Tex. Citizens for a Safe Future & Clean Water, 336 S.W.3d 619 (Tex. 2011) (gives limited deference to agency interpretations of ambiguous statutes)
- City of Allen v. Public Utility Comm'n of Texas, 161 S.W.3d 195 (Tex. App.—Austin 2005, no pet.) (discussed by parties on scope of pro‑forma tariff, but distinguished on facts)