22 A.2d 37 | Pa. Super. Ct. | 1941
Argued March 12, 1941. The Cheltenham Abington Sewerage Company has appealed from an order of the Pennsylvania Public Utility Commission (successor to the Public Service Commission) that its rates were unreasonable, oppressive, and extortionate from October 17, 1933, until January 1, 1937, and that reparations should be awarded for that period.
Appellant furnishes sewerage service to the public in certain areas of Abington and Cheltenham Townships, Montgomery County. On October 6, 1930, in proceedings before the Public Service Commission reported as Ruttle et al. v. Cheltenham AbingtonSewerage Co., 10 Pa. P.S.C. 502, it was ordered to file, post, and publish a tariff for sanitary sewerage service to yield a gross annual revenue not in excess of $36,140. A tariff intended to produce this result was prepared and filed with the commission, and on April 13, 1931, was adopted by the commission as in compliance with the order of October 6, 1930, to become effective on July 1, 1931. *277
The commission, however, on December 11, 1934, on its own motion instituted a proceeding to No. 10,546 of its complaint docket inquiring into the fairness, reasonableness, and justness of the rates provided by this tariff. An order by the commission followed on August 30, 1935, which fixed the annual revenue allowable at the maximum of $27,700. On appeal we reversed the order with directions that the findings, valuations, and rates be reformed so as to permit an annual allowable gross revenue of $30,050. Cheltenham Abington Sewerage Co. v. P.S.C.,
On October 17, 1935, pending the appeal to this court from the order of August 30, 1935, an individual patron of appellant and the Glenside Home Protective Association, Inc., a Pennsylvania corporation of the first class, assignee of various other patrons, filed with the commission a complaint alleging the unjustness and unreasonableness of the rates imposed by appellant in the past, and praying the award of reparations therefor. After hearing, the commission entered an order nisi which sustained the complaint on the finding that appellant's rates were unreasonable, oppressive, and extortionate from October 17, 1933, the two-year period prior to the filing of the complaint, until January 1, 1937, and awarded reparations for that period. Further hearing was ordered to determine the damage sustained by the particular complainants and other patrons of *278 appellant. Appellant's exceptions to this order, except Nos. 6 and 19, which have no bearing on the issues here, were dismissed, the order nisi was made final, and this appeal followed.
The commission has moved to quash the appeal on the ground that the order appealed from is merely an interlocutory order, since it did not attempt to itemize the damages, if any, payable to the particular persons aggrieved, but specifically left the ascertainment of those rights to a further hearing.
The appeal will not be quashed, and the motion is overruled.
The Public Utility Commission and its predecessor under the earlier law, the Public Service Commission, have apparently accepted the suggestion made by this court in Centre County LimeCo. v. P.S.C. et al. (No. 1),
In the second step of the proceedings the evidence, *279 oral and documentary, is usually extremely voluminous. It would seem that the public interest would be more efficiently served by permitting immediate judicial review of the first step than by postponement until the completion of the calculations and tabulations necessarily required in the second. Moreover, the small number of reparation proceedings compared with actions at law guarantees against the hopeless prolongation of the business of both lower and appellate courts, which historically has been the moving consideration against allowing an appeal from an interlocutory order, for example, the overruling of a demurrer.
In Baltimore Ohio Railroad Co. et al. v. Pa. P.U.C. et al.,
In Allegheny Steel Co. v. New York Central R. Co. et al.,
In support of its motion to quash, the commission citesPhiladelphia Electric Co. v. P.S.C. et al.,
Citing as authority the Citizens Passenger Railway Co. v.P.S.C. et al.,
On the merits the order of the commission will be modified and affirmed.
We agree, as it has been argued, that the determination by the commission of the propriety or impropriety of the rate, reparation for the payment of which is here *282
sought, was governed by the Public Service Company Law of July 26, 1913, P.L. 1374,
The old law placed upon the commission the requirement of finding a rate unreasonable to the point of its being oppressive or extortionate in order to award reparations. Centre County LimeCo. v. P.S.C. et al. (No. 1), supra, p. 190. But it is also true that the scope of this court's review of the commission's action is now fixed by the new law. Under section 22 of the Public Service Company Law, as amended by the Act of June 12, 1931, P.L. 530, § 1, 66 P. S. § 836, in every appeal involving a question of reasonableness of rates, we were called upon to exercise our independent judgment whether the findings of the commission were reasonable and proper. See Pennsylvania Railroad Co. et al. v.P.S.C. et al., supra. In Pennsylvania Power Light Co. *283 v. P.S.C. et al.,
"By § 1107 of the new law, designated as the `Public Utility Law,' it is provided that in case of appeals to this court, `the order of the commission shall not be vacated or set aside either in whole or in part except for error of law or lack of evidence to support the finding, determination, or order of the commission or violation of constitutional rights.'
"This appeal involves the reasonableness of rates and in such matters the new law makes a radical change in the scope of the inquiry by this court, limiting our inquiry to matters of law and thereby placing appeals involving a question of reasonableness of rates on the same basis as other appeals.
"The change is procedural and affects pending litigation insofar as it is possible to conform to and give effect to the change in the law."
Although the commission was required to proceed under the old law, and, to award reparations, find the rate oppressive or extortionate, as it here did, a review of its finding does not require the exercise of the independent judgment of this court, but our review is limited to ascertaining whether there was an error of law or a lack of substantial evidence to support the commission's finding.
We are of the opinion that there is no lack of substantial evidence to support the finding and determination of the commission that the rate charged by appellant previous to October 17, 1935, was unreasonable, oppressive, and extortionate. But we are also of the opinion that the commission erred as a matter of law in fixing the date when the rate can be considered to have become oppressive and extortionate. As we have previously stated, the rate was one fixed by a tariff submitted to and accepted by the commission as in compliance with its order of October 6, 1930, that appellant's *284 gross annual revenue was not to exceed $36,140. An element in the calculation by which that figure was reached was the amount appellant was required annually to pay Cheltenham Township, under contract, for conveyance of the sewage collected in appellant's lines through the township sewers and as its proportionate share of the cost of conveyance of the combined sewage through those of the city of Philadelphia and disposal thereof by the city's disposal facilities. Because at the time of those proceedings there was some uncertainty as to that amount, the order of the commission attempted to meet the difficulty with the following provision: "No bills have yet been rendered under that contract, and there is reasonable doubt as to the exact obligations that respondent will be called upon to meet. Under these circumstances the amount claimed by the respondent, $10,940, will be allowed until the exact amount is determined, at which time rate adjustments if necessary can be made."
Appellant does not dispute that for no year did its payments under the contract reach the allowance of $10,940. From 1931 to 1934, inclusive, the highest amount paid was $7,759.86, and the lowest $7,328.98 Obviously the annual reports of appellant to the Public Service Commission reflecting this experience made the commission aware that appellant was earning upwards of $3,000 annually in excess of the maximum the commission intended to allow, and led to its filing the complaint of December 11, 1934. Previous to this date appellant's conduct may have been excusable. There is no doubt that the commission's order as to the necessity of adjustment of rates is somewhat ambiguous, and very likely if the discrepancies between appellant's annual expenditure and the allowance were insignificant, even though in appellant's favor, no adjustment would be considered "necessary." But the differences represented a material percentage of appellant's annual allowable income, and the order was not clear whether *285 appellant had the duty of moving or was justified in awaiting the commission's action. We do not share the view of the commission in its report and order nisi that it was incumbent upon appellant to make a voluntary rate adjustment immediately upon the first annual ascertainment of the unknown quantity of the earnings formula. It may as well be said that the commission had the duty of instituting a complaint on its own motion forthwith. If appellant was remiss the commission was also somewhat lax; its order was ambiguous, and it temporized until December 11, 1934. After the rate was challenged on that date on the commission's own motion, any doubt on appellant's part as to the meaning of the original order should have been dispelled, and its persistence thereafter constitutes evidence of the extortionate and oppressive nature of the rate.
It is true, of course, that a finding in a proceeding on a complaint against the reasonableness of an existing rate for the future, governed by section 3, art. 5, of the Public Service Company Law of 1913, 66 P. S. § 492, furnishes no basis for awarding or refusing reparation of payments of the same rate in the past, an entirely separate proceeding under section 5 of that article of the statute (66 P. S. § 511). Bell Telephone Company ofPennsylvania v. Pa. P.U.C.,
Our conclusion is not determined by the success or failure of the action instituted by the commission on December 11, 1934, but upon the fact that appellant on that date had notice the commission considered the existing rate unreasonable. InPennsylvania Railroad Co. et al. v. P.S.C. et al., supra, we expressed ourselves in a similar manner. In that case it appears that *286
two railroads imposed a rate prescribed by the commission on July 15, 1929. On June 27, 1934, the intervener-shipper filed a complaint against the rate as unreasonable for the future, and on July 31, 1935, it filed a second petition to cover shipments up to July 1, 1935. Both petitions asked for reparations. In a consolidated proceeding the commission sustained both complaints, and, although ordering a further hearing before making an award of reparations, found the rate had been unreasonable, oppressive, and extortionate from June 30, 1932, to June 30, 1935. It appears also, however, that in an independent proceeding by other shippers against the same rate, these carriers, among others, had received notice on October 20, 1934, of the commission's order of October 16, 1934, to reduce the rate. We held that it was error to fix the beginning of the reparations period at June 30, 1932, and modified the order by making it initially effective October 20, 1934. In an opinion by Judge CUNNINGHAM we said (
In the present case it may likewise be said that the institution of the complaint on the commission's own motion on December 11, 1934, gave appellant notice that the commission had determined the rate then charged to be unreasonable. We think that for such a purpose institution of action on the commission's own motion was here the equivalent of a determination by the commission in favor of a patron's complaint. For *287 the period previous to October 20, 1934, in the cited case, the carriers were held to have followed a commission-made rate, and thus escaped liability for reparation. So, in the instant case, previous to December 11, 1934, the rate applied under the commission's order of October 6, 1930, and accepted by the commission as complying with this order must be considered a commission-made rate. The commission was without power to order reparations for any period during which the commission-made rate was effective. This has been discussed at length in PennsylvaniaRailroad Co. et al. v. P.S.C. et al., supra, and in Baltimore Ohio Railroad Co. et al. v. Pa. P.U.C. et al., supra, and requires no further elaboration.
Appellant also contends that the commission erred in finding reparations payable after the date of the filing of the petition, that is, from October 17, 1935, until January 1, 1937. We have been given no authority which is decisive of this question. The commission in its brief has referred to Turtle Creek Borough v.Pennsylvania Water Co.,
Finally, appellant challenges the propriety of reference by the commission in its order nisi to files of the commission not in evidence at the hearing as showing the continuance during 1934 of informal conferences between appellant and the commission relative to a voluntary adjustment of its rates. In view of the disposition which we have made of the commission's finding as to the period previous to December 11, 1934, this contention becomes immaterial.
The ninth, tenth, eleventh, and twelfth assignments of error, in so far as they relate to dismissal of appellant's twentieth and thirtieth exceptions to the order nisi of the commission, are sustained. The remaining assignments of error are overruled.
The final order of the commission is affirmed, with the modification that its operation and effect be restricted to the period from December 11, 1934, to January 1, 1937.