302 P.3d 405
N.M.2013Background
- In 1983 the PRC issued Moongate a CCN to serve outside Las Cruces; the same area was later extended in 1984.
- Las Cruces annexed three undeveloped tracts within Moongate’s certificated area and committed to provide water there.
- Moongate sued seeking injunction, declaratory judgment, inverse condemnation, and regulatory taking; district court granted inverse condemnation and takings relief but later found no damages.
- Court of Appeals held Moongate’s CCN did not grant exclusive service rights against Las Cruces.
- This Court holds Las Cruces is not subject to the PUA and Moongate’s loss of an abstract right to serve is not a cognizable taking absent tangible loss; remands for entry of judgment for Las Cruces.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Moongate have exclusive rights in the certificated area? | Moongate argues CCN grants exclusive rights overriding municipal actions. | Las Cruces is not under the PUA and may compete in the certificated area. | Moongate’s CCN does not prevent municipal competition. |
| Was there a regulatory taking when Las Cruces annexed and served the area? | Las Cruces’ invasion constitutes taking of Moongate’s rights requiring compensation. | No taking without tangible loss; Moongate had no infrastructure or customers in the area. | No taking without tangible loss; loss of an abstract right is not compensable. |
| Is Las Cruces subject to the Public Utilities Act in this context? | PUA applies to limit municipal intrusion into certificated areas. | Las Cruces is not subject to the PUA due to size/standards; intrusions are governed by other statutes. | Las Cruces is not subject to the PUA; intrusions are not prohibited under the PUA for smaller municipalities. |
| Can stranded assets theory support a taking here? | Moongate would be entitled to compensation for investments/resources impaired. | There were no tangible assets or damages shown. | No stranded asset taking proven; compensation not warranted absent tangible loss. |
Key Cases Cited
- Thunder Mountain Water Co. v. City of Albuquerque, 2007-NMSC-031 (NMSC 2007) (takings framework; regulates both federal/state takings principles)
- Morningstar Water Users Ass’n v. N.M. Pub. Regulation Comm’n, 120 N.M. 579 (NM 1995) (municipality not subject to PUA; intrusion protections apply differently)
- United Water N.M., Inc. v. N.M. Pub. Util. Comm’n, 1996-NMSC-007 (NMSC 1996) (condemnation/utility regulation framework; tangible assets allowance)
- Townsend v. State ex rel. State Highway Dep’t, 117 N.M. 302 (NM 1994) (inverse condemnation remedy traditional baseline)
- Delmarva Power & Light Co. v. City of Seaford, 575 A.2d 1089 (Del. 1990) (takings for customer accounts; importantly distinguishes abstract rights vs. tangible assets)
- City of Jackson v. Creston Hills, Inc., 172 So. 2d 215 (Miss. 1965) (invasion of certificated territory with established infrastructure may constitute taking)
- Fleming v. Town of Silver City, 1999-NMCA-149 (NMCA 1999) (statutory interpretation context; PUA applicability limitations)