219 P. 65 | Cal. | 1923
This court had occasion once before to outline the facts of the instant case, and for the purposes of the present consideration it adopts its former statement of facts with some modifications.
By this proceeding petitioners seek to have reviewed and annulled a certain order and decision of the Railroad Commission, given and made on April 26, 1922, with relation to the water rates of the Sutter-Butte Canal Company, in so far as the said order and decision of the Commission affects and undertakes to regulate certain water rates payable by petitioners as customers of the Canal Company in alleged violation of law. The individual petitioners herein, and also those persons who constitute the membership of the several associations who are named as petitioners herein and for whom merely an oral appearance was entered and who introduced no evidence before the Commission with the exception of two, are land owners in the region supplied with water for irrigation purposes by the Canal Company, and as such land owners are either directly, or through their predecessors in interest, the holders of contracts with such Canal Company or its predecessors, for the furnishing of water upon their respective parcels of land. No complaint is made as to the rates fixed by the order nor is the necessity of an increase in rates questioned. [1] The sole question is whether or not these rates should be applied to the full acreage covered by the contracts or only to the acreage actually irrigated, assuming the contract holder does not desire to irrigate all the land covered by his contract. These contracts in at least six different forms were entered into at various times by the parties thereto prior to the year 1913. They differ somewhat as to the charge per acre for water and also in some instances as to the amount of the initial charge required by the water company at the time of making said contracts; but in other respects they are substantially the same and constitute a burden or servitude upon the waters of the Canal Company. (Southern Pac. Co. v. Spring Valley Water Co.,
The petitioners do not contend that the Sutter-Butte Canal Company and its predecessors through whom they claim to have received their water right contracts had not taken on the character of a public utility from a period antedating their said contracts, nor do they deny that their contract rights thereunder were not at all times subject to control and regulation as to rates by the state under article I, section 16, of the state constitution.
The Railroad Commission did not attempt to change, limit, modify, or abrogate any of the provisions of said contracts. A decision on the question of liens, as well as other questions of a purely legal character, was reserved by the Railroad Commission for adjudication by the courts. (Law v. RailroadCom.,
[2] The power of this court to review the orders and decisions of the Railroad Commission are expressly limited *139 by constitutional provision. Section 23 of article XII of the constitution provides: "Every private corporation, and every individual or association of individuals, owning, operating, managing or controlling any . . . canal, pipe-line, plant or equipment, or any part of such . . . canal, pipe-line, plant or equipment within this state, . . . for the production, generation, transmission, delivery or furnishing of heat, light, water or power . . . either directly or indirectly, to or for the public . . . is hereby declared to be a public utility subject to such control and regulation by the Railroad Commission as may be provided by the legislature, and every class of private corporations, individuals, or associations of individuals hereafter declared by the legislature to be public utilities shall likewise be subject to such control and regulation. The Railroad Commission shall have and exercise such power and jurisdiction to supervise and regulate public utilities, in the State of California, and to fix the rates to be charged for commodities furnished, or services rendered by public utilities as shall be conferred upon it by the legislature, and the right of the legislature to confer powers upon the Railroad Commission respecting public utilities is hereby declared to be plenary and to be unlimited by anyprovision of the Constitution. . . ." (Italics ours.)
Deriving its authority from the above constitutional source the legislature has provided, by section 67 of the Public Utilities Act, the limit of this court's jurisdiction and power as a reviewing body by the following provision: ". . . The review shall not be extended further than to determine whether the commission has regularly pursued its authority, including a determination of whether the order or decision under review violates any right of the petitioner under the constitution of the United States or of the State of California. The findingsand conclusions of the commission on questions of fact shall befinal and shall not be subject to review; such questions of fact shall include ultimate facts and the findings and conclusions of the commission on reasonableness anddiscrimination. The commission and each party to the action or proceeding before the commission shall have the right to appear in the review proceeding. Upon the hearing the supreme court shall enter judgment either affirming or setting aside the order or decision of the commission. . . ." (Italics ours.) *140
By section 17 (b) of said act it is again provided: " Except as in this section provided, no public utility shall charge, demand, collect or receive a greater or less or different compensation for any product or commodity furnished . . . or for any service rendered . . . than the rates, tolls, rentals and charges applicable to such product or commodity or service as specified in its schedules on file and in effect at the time . . . nor shall any such public utility refund or remit, directly or indirectly, in any manner or by any device, any portion of the rates, tolls, rentals and charges so specified, nor extend to any corporation or person any form of contract or agreement or any rule or regulation or any facility or privilege except such as are regularly and uniformly extended to all corporations and persons; provided, that the commission may by rule or order establish such exceptions from the operation of this prohibition as it may consider just and reasonable as to each public utility."
The above cited article of the constitution and sections of the Public Utilities Act are conclusive upon the question that the Railroad Commission's decision and order in the instant case on the question of discrimination and classification is not subject to annulment by this court. But if we were vested with jurisdiction to correct or annul the decision it is by no means certain that we would do so upon the record presented and the showing made. That there is a logical and natural ground for the classification made by the Railroad Commission seems convincing. A great many of the contract consumers had, in various ways from the beginning of the utility's existence, aided financially and otherwise in the construction and maintenance of the irrigation system by liberal loans of money, advancements, donations of rights of way, and by making initial payments aggregating large amounts for water rights as shown by the record in the instant case, as well as in former and other proceedings had before this court in which the affairs of this identical Canal Company were involved. It is true that any sums which became due for water service became a lien upon the lands and might be foreclosed as such, but this provision was a part of a contract freely entered into. In addition to the advantages here pointed out the contract holder's right to water was appurtenant to and ran with the land and continued as long as the corporate existence of the Canal Company lasted. *141
It is the claim of petitioners that under certain decisions of this court, notably Leavitt v. Lassen Irr. Co.,
The Commission further found from the record before it that a compliance with petitioners' request to relieve a large acreage from water-rate payments contrary to their agreements would have reduced the revenues of the Canal Company *142 to a dangerous if not ruinous point and probably would have seriously crippled, if not defeated, plans for present and future developments that were essential to the welfare of all concerned. Whether or not petitioners used upon their lands the full amount of water which they bound themselves to pay for, it was the duty of the Canal Company, nevertheless, to hold itself in readiness to supply the water when required. Without discussing the legal effect of these two last propositions they were entitled to receive, and did receive, consideration by the Commission in balancing the equities of the parties to this proceeding. 'The duty of the Canal Company to furnish the water which it agreed to furnish by its contract remains a continuing and enforceable obligation excusable only upon the happening of some such contingency as was pointed out in Butte County WaterUsers' Assn. v. Railroad Com., supra.
That the rights conferred upon petitioners by said contracts were regarded by them as being of value is well shown by their unwillingness to concede that said contracts were in anywise annulled or abrogated by the Commission's action.
In making the classification for the purpose of rate-fixing the Commission gave consideration to a number of important factors or elements which distinguished one class from the other. The contract holders paid an initial charge which the year-to-year customers were not required to pay and it was the judgment of the Commission that it was unfair that the new customers should receive service at the same cost as those who had made advance payments and were permanent consumers. A vast majority of the new consumers were growers of rice, an industry which had suddenly developed into favor and prominence, but which was in a speculative stage. Rice-growing required in some respects a different kind of service than was required for the production of other crops. They were classed as short-term consumers but, like all of their class, were permitted to enter the class of the contract holders by paying said initial or advance payments. It is clear that the purpose of classification was in the interest of equalizing as far as the situation would permit, the cost of carrying water upon the lands of all of the Canal Company's consumers. Petitioners have shown no violation of the provisions of section 19 of the Public Utilities Act, which provides that no public utility shall make or grant any preference or advantage to any corporation or *143 person or subject any person or corporation to any prejudice or disadvantage or establish or maintain any unreasonable difference as to rates, charges, service, facilities, or in any other respect as between classes of service. It will be noted that this section provides that the Commission shall have the power to determine any question of fact arising under said section.
We find nothing in the record by way of evidence which shows or tends to show that the classification made by the Commission in dealing with a complex situation was either unfair or unreasonable as to the members of either class of consumers. On the contrary, there is much to show that the entire effort of the Commission was to compose and equalize an inharmonious situation brought about by various causes.
[3] There is no claim made that the rates established by the Railroad Commission were confiscatory or oppressive. No design has been shown on the part of anyone to give any person an unlawful preference or unfair advantage over another or to indulge in an unlawful discrimination in any manner whatsoever. Not every discrimination or recognition of a ground of difference may be classified as unlawful. A discrimination based upon reason and justice can properly exist. The true principle which governs the instant case is correctly stated inPennsylvania R. R. Co. v. International Coal Mining Co.,
The Railroad Commission undoubtedly had jurisdiction to make the order under review. Its classification for the purpose of rate-fixing was a legitimate exercise of its power. As a matter of law it cannot be said that it was arbitrary or unreasonable. But, however this may be, its findings and conclusions on questions of "reasonableness and discrimination" are not subject to review by this court.
The order is affirmed.
Lennon, J., Waste, J., Wilbur, C. J., Kerrigan, J., and Lawlor, J., concurred.
Rehearing denied.
All the Justices concurred.