527 S.E.2d 495 | W. Va. | 1998
Lead Opinion
Petitioner West Virginia Highlands Conservancy, Inc. (“Conservancy”)
The Conservancy filed a complaint with the Commission on September 30, 1997, against Allegheny Power System (“Allegheny”),
In response to the complaint filed against it, Allegheny moved to dismiss the Conservancy’s complaint on the grounds that Allegheny is not a public utility subject to the Commission’s jurisdiction. Asserting that it is a public utility holding company
By order dated December 30, 1997, the Commission stated its finding that none of the entities involved in the Blackwater River Canyon land sale were public utilities regulated by the Commission. In addition, the Commission determined that no West Virginia public utility assets were involved in the disputed transaction. Concluding that it was without authority to review the transaction in issue, the Commission dismissed the complaint and refused to grant the Conservancy’s request for permission to take the deposition of Alan J. Noia, Allegheny’s President and chief executive officer.
II. Standard of Review
Unlike most appeals from Commission rulings, this case does not fall within the three-pronged standard of review prototype set forth in syllabus point one of Central
While the parties are in agreement that jurisdictional issues invoke de novo review, Allegheny asserts that “[interpretations of statutes by bodies charged with their administration are given great weight unless clearly erroneous.” Appalachian Power, 195 W.Va. at 588, 466 S.E.2d at 439 (citing Lincoln County Bd. of Educ. v. Adkins, 188 W.Va. 430, 424 S.E.2d 775 (1992), syl. pt. 7, in part). With reference to the Commission’s finding that Allegheny is not a public utility, Allegheny argues that the Commission’s findings of fact cannot be reversed under Boggs v. Public Service Commission, 154 W.Va. 146, 174 S.E.2d 331 (1970), absent a conclusion that such findings are contrary to the evidence or that they lack supporting evidence. See id. at 147, 174 S.E.2d at 332, syl. pt. 5, in part (citing United Fuel Gas Co. v. Public Service Comm’n, 143 W.Va. 33, 99 S.E.2d 1 (1957)). Against these principles, we proceed to consider whether the Commission correctly determined that it lacked jurisdiction to review the subject land transaction.
III. Discussion
Our determination of whether the Commission has authority to review the land sale at issue necessarily requires an examination of the nature of the Commission’s jurisdiction. In syllabus point two of Wilhite v. Public Service Commission, 150 W.Va. 747, 149 S.E.2d 273 (1966), we stated: “The Public Service Commission of West Virginia has no jurisdiction and no power or authority except as conferred on it by statute and necessary implications therefrom, and its power is confined to regulation of public utilities. It has no inherent power or authority.” Thus, the Commission is without power to consider issues not expressly included within its grant of legislative authority.
The jurisdictional question presented in this case arises from the Conservancy’s position that Allegheny failed to comply with the provisions of West Virginia Code § 24-2-12. That statute provides, in pertinent part:
Unless the consent and approval of the public service commission of West Virginia is first obtained: ... (c) no public utility subject to the provisions of this chapter, ... may assign, transfer, lease, sell, or otherwise dispose of its franchises, licenses, permits, plants, equipment, business or other property or any part thereof, but this shall not be construed to prevent the sale, lease, assignment or transfer by any public utility of any tangible personal property.-which is not necessary or useful, nor will become necessary or useful in the future, in the performance of its duties to the public[.]
W. Va.Code § 24-2-12(c) (emphasis supplied). By legislative fiat, this consent and approval provision only applies to property dispositions contemplated by public utilities.
The term “public utility” is defined by West Virginia Code § 24-2-1 (1992) as “any
The test as to whether or not a person, firm or corporation is a public utility is that to be such there must be a dedication or holding out either express or implied that such person, firm, or corporation is engaged in the business of supplying his or its product or services to the public as a class or any part thereof as distinguished from the serving of only particular individuals; and to apply this test the law looks at what is being done, not to what the utility or person says it is doing.
150 W.Va. at 748, 149 S.E.2d at 274, syl. pt. 3.
The Conservancy’s position that Allegheny does come within the definition of a public utility sufficient to invoke the provisions of West Virginia Code § 24-2-12 is rooted in its view that Allegheny’s corporate restructuring significantly altered the manner in which Allegheny and its subsidiaries conduct business. As a result of a corporate reorganization that Allegheny underwent in 1995, Allegheny now utilizes a single management team to direct both its functions as a public utility holding company and the operations of its three utility subsidiaries.
In support of its position, the Conservancy suggests that the factors typically used for deciding whether to “pierce the corporate veil” for purposes of holding shareholders personally liable for the actions of a corporation should analogously be utilized to find the existence of jurisdiction in this ease. See Laya v. Erin Homes, Inc., 177 W.Va. 343, 352 S.E.2d 93 (1986).
In response to the Conservancy’s assertion that Alegheny has complete control of its utility subsidiaries, Alegheny states that federal law expressly prohibits public utility holding companies such as Alegheny from owning or acquiring utility assets. See 15 U.S.C. § 79d(a). Federal law also proscribes a public utility holding company from engaging in any acts that would cause it to be a “public utility.” 15 U.S.C. § 79i. In explanation of its corporate reorganization, Alegheny states that the reorganization was effectuated for the joint purposes of cost containment and to meet competition in the wake of pending utility deregulation. Ale-gheny emphasizes that the separate corporate status of the utility subsidiaries has not been affected or altered as a result of the reorganization. There has been no transfer of physical assets among the separate companies; no new legal entities were created; and no existing legal entities were dissolved. The rate bases of the various utility subsidiaries remain separate and distinct, as always. Expenses are calculated
Concerning the Conservancy’s contention that jurisdiction can be achieved through the doctrine of corporate veil piercing, Allegheny asserts that such doctrine is inapposite.
Upon examination, the Conservancy’s arguments in support of veil piercing for the purpose of creating jurisdiction prove specious. Critically, the principles upon which veil piercing is predicated — liability may be asserted when the corporate form is being used to perpetrate harm or injustice — do not transpose to support the creation of subject matter jurisdiction. This is especially true where, as here, subject matter jurisdiction is created by, and defined by, statute. See W. Va.Code § 24-2-1. The Commission observes that the Conservancy has failed to cite even one case in which corporate veil piercing was used against a public utility holding company to assert subject matter jurisdiction on the theory that the holding company was operating as a public utility, as the Conservancy urges this Court to conclude in this ease. Because liability and subject matter jurisdiction are very different legal concepts, no other court has been persuaded to apply the corporate veil piercing doctrine in the fashion advocated by the Conservancy.
This critical distinction concerning the uniqueness of subject matter jurisdiction proves equally fatal to the Conservancy’s attempt to rely on decisions issued by this Court that addressed whether a company was doing business within this state under a minimum contacts analysis. In each of those decisions — Bowers, Bell Atlantic, and Norfolk Southern — the issue was whether a company was doing business within this state sufficient to permit this state to exercise personal jurisdiction over the parent corporation in connection with claims predicated on traditional tort or contract theories. None of those cases involved the situation presented in the case sub judice where subject matter jurisdiction is expressly governed by statute.
Even assuming, arguendo, that the doctrine of veil piercing was applicable for purposes of establishing subject matter jurisdiction, it appears that the law would still not support veil piercing under the facts of this case. While the law presumes that two separately incorporated businesses are distinct entities, United States v. Bestfoods, 524 U.S. 51, 118 S.Ct. 1876, 1888, 141 L.Ed.2d 43 (1998), this presumption can be disregarded when the corporate form is being used to perpetrate injustice, defeat public convenience, or justify wrongful or inequitable conduct. Laya, 177 W.Va. at 347, 352 S.E.2d at 97 (quoting Southern States Coop., Inc. v. Dailey, 167 W.Va. 920, 930, 280 S.E.2d 821, 827 (1981)). While a variety of factors are typically examined to determine whether veil piercing is warranted,
In the final analysis, the issue of whether the Commission has subject matter jurisdiction over the Blaekwater River Canyon land sale must be resolved by reference to the body of law which governs public utilities. As discussed above, the Commission’s jurisdiction is expressly limited to those matters involving public utilities. W. Va.Code § 24-2-1. By definition, a public utility involves the holding out or dedicating of a product or services to the public. See id.; Wilhite, 150 W.Va. at 760, 149 S.E.2d at 281. In this case, the land at issue has never been used to supply any utility services to the West Virginia public. Neither has that parcel of land ever been reported as an asset or been included in the rate base of a West Virginia public utility. The statute upon which the Conservancy asserts entitlement to post facto review of the land sale only applies to public utilities. See W. Va.Code § 24-2-12. Yet, Allegheny, as a public utility holding company, is proscribed by federal law from operating as public utility. See 15 U.S.C. § 79i(a)(l). Upon the facts of this case, there is only one conclusion that can be reached: Allegheny is not a public utility subject to the jurisdiction of the Commission. Accordingly, we find that the Commission was correct in its determination that it lacked jurisdiction to proceed on the merits of the Conservancy’s complaint.
We are sympathetic to the environmental concerns that obviously motivated the Conservancy to initiate the cause of action below and we fully recognize that the sale of the
The preservation of the Blackwater Canyon is an emotional issue and well it should be. There is an inherent tension between private property rights and public environmental concerns, and growing interest in the development of public policy that will preserve the integrity of our environment for future generations. Although historically the right to hold private property has been sacrosanct in our democracy, American property law at the close of the twentieth century must mediate to some extent between protecting the individual freedoms of property owners and the interests of the community at large. See Terry W. Frazier, Protecting Ecological Integrity Within the Balancing Function of Property Law, 28 Environmental Law 53, 109 (1998). “The use of private property is increasingly subject to government regulation in the public interest to protect the environment and guard against thoughtless development.” Atlantic Inti Inv. Corp. v. Turner, 381 So.2d 719, 722 (Fla.Dist.Ct.App.1980). It has been recognized, however, that while
we have begun to acknowledge our dependence upon ecological integrity, the process of including protection of ecological integrity in the balancing function of property law is nowhere near complete. Our understanding and legal recognition of humankind’s place in land communities lags behind our understanding and recognition of the importance of humans’ relations to each other. Property laws do not reflect principles of biology, ecology, and other natural sciences to anywhere near the extent that property laws reflect principles of philosophy, sociology, economics, and other social sciences.
Frazier, supra, 28 Environmental Law at 110.
If the natural integrity of the Blackwater River Canyon is destroyed, it will be a tragedy for the people of West Virginia. It is unfortunate that state government has not taken a more active role in the stewardship of our environment by developing both law and public policy that takes environmental concerns into account; that environmental organizations were not more aggressive in seeking to purchase and preserve this land at an earlier point in time; and that West Virginia Powér did not show more corporate responsibility to this state by selling the land to environmentalists for purposes of preservation notwithstanding the realization of reduced profits.
The harsh reality is that the protection of the environment, and not utility regulation, is what is truly at stake here; the Public Service Commission, however, is not the forum to address environmental concerns. Consequently, a holding by this Court finding jurisdiction before the Commission would not only convolute the law, but in the final analysis would clearly afford no real relief to the Conservancy and no protection to the Black-water River Canyon.
Affirmed.
. We point out that a per curiam opinion is not legal precedent. See Lieving v. Hadley, 188 W.Va. 197, 201 n. 4, 423 S.E.2d 600, 604 n. 4 (1992).
. In addition to the Conservancy, the Sierra Club and the West Virginia Wildlife Federation are named plaintiffs in this case. Chuck Merritt and James M. Sconyers are named as individual plaintiffs.
. Allegheny Power System has since changed its name to Allegheny Energy.
. The Conservancy was unsuccessful in its attempt to buy the piece of property at issue. It was outbid on the property by Canyon Lands, who purchased the property for $4,850,000. The property has since been reconveyed by Canyon Lands to Allegheny Wood Products. According to representations made during oral argument, the current owner of the subject piece of property is already timbering the land. Although the Conservancy did not apply for a stay in this case, this Court's jurisdiction to rule on such relief would be limited as Allegheny Wood Products is not a party to these proceedings.
. West Virginia Power and Transmission Company is a wholly-owned subsidiary of West Penn Power Company, a Pennsylvania public utility. West Penn Power Company is a subsidiary of Allegheny.
. Since the land at issue has already been sold, the Conservancy seeks to have the land sale declared null and void for failure to comply with West Virginia Code § 24-2-12.
. As a public utility holding company, the only assets Allegheny has are the stocks of utility companies.
. Pursuant to 15 U.S.C. § 79i(a)(l) (1994), a public utility holding company is prohibited by federal law from providing utility services unless it first receives permission to do so from the Securities and Exchange Commission ("SEC”). Allegheny states that it has not applied to the SEC for such permission.
. Mr. Noia is also the CEO of Monongahela Power Company, Potomac Edison Company, West Penn Power, all three of which are utility subsidiaries of Allegheny.
. Most appeals arising from the Commission involve the following standard of review: (1) whether the Commission exceeded its statutory jurisdiction and powers; (2) whether there is adequate evidence to support the Commission's findings; and (3) whether the substantive result of the Commission’s order is proper. See Central West Virginia Refuse, 190 W.Va. at 416-17, 438 S.E.2d at 596-97, syl. pt. 1.
. Obviously, any personal property that meets the description of the proviso language contained in West Virginia Code § 24-2-12 is exempted from the consent and approval requirements of that provision.
.Allegheny is the parent corporation of three operating utility subsidiaries: Monongahela Power, Potomac Edison, and West Penn. Monongahela Power is an Ohio Corporation that provides electric services to citizens of both West Virginia and Ohio. Potomac Edison is a Maryland and Virginia corporation that provides utility services to customers located in Maryland, West Virginia, and Virginia. West Penn is a Pennsylvania corporation whose service area lies entirely within Pennsylvania.
Two additional corporations are subsidiaries of Allegheny. They are Allegheny Power Service Corporation and AYP Capital, Inc. Neither of these subsidiaries are in the business of providing utility services. According to Allegheny, Allegheny Power Service Corporation acts as a mutual service company for Allegheny’s subsidiaries, in accordance with 12 U.S.C. § 79m (1994) and SEC regulations. AYP Capital is a non-regulated subsidiary that engages in various unregulated businesses as permitted by the SEC.
. As additional support for its position that Allegheny is a public utility, the Conservancy cites this Court's observation in Boggs v. Public Service Commission, 154 W.Va. 146, 174 S.E.2d 331 (1970), that " ‘the distinguishing characteristic of a public utility is the devotion of private property by the owner or person in control thereof to such a use that the public generally, or that part of the public which has been served and has accepted the service, has the right to demand that the use or service, as long as it is continued, shall be conducted with reasonable efficiency and under proper charges.’” Id. at 151-52, 174 S.E.2d at 335 (quoting 73 C.J.S. Public Utilities § 1 and emphasis supplied).
. In Laya, we identified the following factors as useful in analyzing the issue of corporate veil piercing:
(1) commingling of funds and other assets of the corporation with those of the individual shareholders;
*638 (2) diversion of the corporation's funds or assets to noncorporate uses (to the personal uses of the corporation's shareholders);
(3) failure to maintain the corporate formalities necessary for the issuance of or subscription to the corporation's stock, such as formal approval of the stock issue by the board of directors;
(4) an individual shareholder representing to persons outside the corporation that he or she is personally liable for the debts or other obligations of the corporation;
(5) failure to maintain corporate minutes or adequate corporate records;
(6) identical equitable ownership in two entities; '
(7) identity of the directors and officers of two entities who are responsible for supervision and management (a partnership or sole proprietorship and a corporation owned and managed by the same parties);
(8) failure to adequately capitalize a corporation for the reasonable risks of the corporate undertaking;
(9) absence of separately held corporate assets;
(10) use of a corporation as a mere shell or conduit to operate a single venture or some particular aspect of the business of an individual or another corporation;
(11) sole ownership of all the stock by one individual or members of a single family;
(12) use of the same office or business location by the corporation and its individual shareholder(s);
(13) employment of the same employees or attorney by the corporation and its shareholder(s);
(14) concealment or misrepresentation of the identity of the ownership, management or financial interests in the corporation, and concealment of personal business activities of the shareholders (sole shareholders do not reveal the association with a corporation, which makes loans to them without adequate security);
(15) disregard of legal formalities and failure to maintain proper arm’s length relationships among related entities;
(16) use of a corporate entity as a conduit to procure labor, services or merchandise for another person or entity;
(17) diversion of corporate assets from the corporation by or to a stockholder or other person or entity to the detriment of creditors, or the manipulation of assets and liabilities between entities to concentrate the assets in one and the liabilities in another;
(18) contracting by the corporation with another person with the intent to avoid the risk of nonperformance by use of the corporate entity; or the use of a corporation as a subterfuge for illegal transactions;
(19) the formation and use of the corporation to assume the existing liabilities of another person or entity.
177 W.Va. at 347-48, 352 S.E.2d at 98-99.
. Since one of the many claims asserted in Bell Atlantic involved inside wire maintenance services, which comes within the province of the Commission, we determined that the circuit court and the Commission had concurrent jurisdiction in that case. Notwithstanding the doctrine of primary jurisdiction, which, if applied, would require the circuit court to "refrain from exercising jurisdiction until after the agency has resolved the issue” under its jurisdiction, we determined that the circuit court had properly retained jurisdiction of the case as the legal issues under consideration (violations of antitrust and consumer protection laws as well as common law theories) were "well within the conventional experience of the circuit court.” 201 W.Va. at 411, 497 S.E.2d at 764, 766.
. See supra note 14.
. Based on our decision that the Commission is without jurisdiction, we do not address the Conservancy’s assignment that the Commission committed error in refusing to grant its request to conduct discovery.
. The Conservancy recently filed an action in federal court under the Endangered Species Act of 1973, 16 U.S.C. § 1531 to 1544 (1994), wherein they alleged that four species of animals indigenous to this state (northern flying squirrel, Cheat Mountain salamander, Indiana bat, and Virginia big-eared bat) are being harmed as a result of the timbering operations that are currently in progress on the subject land.
. Allegheny Power’s Internet home page (www.alleghenypower.com), states that "Allegheny Power serves an area of about 29,000 square miles, and about 1.4 million customers in parts of Maryland, Ohio, Pennsylvania, Virginia and West Virginia.... Our customers include more than a million residences from central West Virginia to the New York border....”
Dissenting Opinion
dissenting:
(Filed Dec. 16, 1998)
I begin with a quotation that seems to me to be highly relevant to the instant case. It is an excerpt of the March 4, 1893 inaugural address of Governor William A. MacCorkle:
There are several matters, however, of great importance to the State and to the people, upon which is due the information as to the policy of this administration for the next four years.
First among these questions of interest to the State is the question of the ownership of lands.
The State is rapidly passing under the control of large foreign and non-resident land owners. We welcome into our State the immigrant who comes to us with the idea of home seeking and home building with all its profits to the State, with its family ties, with its clearing of the forests, its building of church and school houses, its expenditure of all that is made in our State, and its exercise of citizenship. But the men who to-day are purchasing the immense areas of the most valuable lands in the State, are not citizens and have only purchased in order that they may carry to their distant homes in the North, the usu-fruct, of the lands of West Virginia, thus depleting the State of its wealth to build grandeur and splendor in other States. In a few years at the present rate of progress, we will occupy the same position of vassalage to the North and East that Ireland does to England, and to some extent, for the same reasons.
Public Papers of Governor William A Mac-Corkle, 9-10 (1897).
One hundred and five years later, the question of the ownership and sale of the lands of this State is still pressing upon us. In the instant case, our State is being depleted of its wealth to build the grandeur and splendor of a foreign holding company that calls itself an electric utility, acts like an electric utility, and has reorganized itself so that it functions as one, unified electric company. Yet this company still evades public scrutiny because, before the Public Service Commission, it claims that it is not really an electric utility.
In its 1995 reorganization, Allegheny Power employed “smoke and mirrors” — an illusion done on paper — so that it could operate as a single utility company, but claim it was a conglomerate of small, independent companies. Allegheny Power operates as a single corporate body, using electricity generated by the right hand to supply customers who are sitting at the left. Allegheny Power holds itself out to the public as one, unitary public utility company — but when the public asks, “are you really acting for our benefit?” Allegheny Power smiles and says “none of your business — we’re not a public utility company.”
The majority opinion not only begrudgingly gives its blessing to that illusion, the majority says that the Public Service Commission, the public agency charged with making sure public utilities act in the public’s best interests, cannot look behind the smoke and mirrors.
The result is that Allegheny Power gets the milk without having to buy the cow — it gets to drink in profits from selling electricity to the citizens of West Virginia, without having to submit its activities to the scrutiny of the Public Service Commission.
This is wrong, because in this ease, the illusion has concrete, permanent, and in my judgment, devastating consequences for the people of this State. I therefore dissent.
A.
Allegheny Power Holds Itself out to the Public as a Public Utility
Allegheny Power’s sale of the Blackwater Canyon should be subject to the jurisdiction of the Public Service Commission for a simple reason: Allegheny Power holds itself out to the public as a single, unified public utility company. I am at a loss to understand how
We said in Syllabus Point 3 of Wilhite v. Public Service Commission, 150 W.Va. 747, 149 S.E.2d 273 (1966) that the test as to whether or not a corporation is a public utility involves “look[ing] at what is being done, not to what the utility or person says it is doing.” (Emphasis added.) Basically, the Public Service Commission should look at whether the corporation is holding itself out as being “engaged in the business of supplying ... its product or services to the public as a class.... ” In this cpse, when it is to its own benefit, Allegheny Power holds itself out as being engaged in the business of supplying electricity to West Virginia consumers.
Allegheny Power says that West Penn Power Company (the owner of West Virginia Power and Transmission Company, and thus the owner of the Blackwater Canyon property) was once a separate, independent company — but West Penn has now been replaced by a company called “Allegheny Power.” On its Internet home page (http://www.alleghe-nypower.com), Allegheny Power says that “Some of you have known us in the past as Monongahela Power, Potomac Edison, or West Penn Power.... Now we’re Allegheny Power. We changed our name and the way we do business so we can remain strong and competitive among the nation’s electric utility companies.” (Emphasis added.)
Thus, in its own writings, Allegheny Power calls itself an “electric utility companfy].” Allegheny Power also acts like an electric utility company. Still, the Public Service Commission ignored Allegheny Power’s public statements and actions. Instead, the Public Service Commission relied upon Allegheny Power’s courtroom statements that it isn’t an electric utility company, but rather is merely a holding company that owns stock in several utility companies.
Applying the Public Service Commission’s reasoning, when the king says he is fully clothed, we must all agree — even though he is standing there buck naked.
In other Allegheny Power writings, the company discusses its “commitment to the environment” in West Virginia! Each time Allegheny Power talks about itself as one utility company, not as a holding company for several smaller Utilities. For example, one brochure posted on Allegheny Power’s Internet home page states that, “At Allegheny Power, environmental stewardship and leadership is not just something we talk about, it’s our commitment.... Because at Allegheny Power, we believe it’s our responsibility to protect the environment for our Company, our customers, and for future generations.”
Allegheny Power, before this Court and the Public Service Commission, claims it owns no power generating plants, sells no electricity, and is therefore not a public utility. Yet, when it is to the benefit of Allegheny’s public image, the company says about a power plant located in Haywood, West Virginia, “Harrison Power Station, Allegheny Power’s largest generating plant, is home to some of the most sophisticated air pollution-
Power plants typically make electricity for public consumption. The term “service territory” implies that public service is being supplied to a region. I am therefore at a loss to understand how Allegheny Power can claim to own a large power generating plant and have a West Virginia service territory, and still not be a public utility subject to Public Service Commission jurisdiction.
B.
Allegheny Power holds itself out as the owner of the Blackwater Canyon
When it’s good for public relations, Allegheny Power takes credit for donating part of its Blackwater Canyon properties to the State for the creation of Blackwater Falls State Park. On its Internet home page, in a public-relations brochure discussing the environment, Allegheny Power claims:
The majestic Blackwater Falls area in West Virginia became part of the public landscape in 1953 when Allegheny Power donated 600 acres to the state of West Virginia, ensuring that the natural beauty of this area would be preserved.
Amazingly, while Allegheny Power claims on the one hand that it donated 600 acres of the Blackwater Canyon to the State in 1953, it claims on the other hand before the Public Service Commission and before this Court that it never owned that land. Which is true?
I recognize that the donation of the Black-water Canyon land in 1953, and the later sale of 3,000 acres in 1996, were ostensibly performed under the name of the West Virginia Power and Transmission Company. However, I’m curious to know where the money went from that sale — if Allegheny Power management made the actual decision to sell the Canyon land, and if Allegheny Power’s treasury received the money from the sale, or if Allegheny Power’s in-house lawyers negotiated and oversaw the sale, then that sale should be open to scrutiny by the Public Service Commission.
C.
The Sale of the Blackwater Canyon Property is Subject to Scrutiny by the Public Service Commission
The Public Service Commission exists to regulate public utilities, and oversee how services are provided and rates charged. As part of that oversight, our laws say that a public utility must get the Public Service Commission’s approval every time it tries to “assign, transfer, lease, sell, or otherwise dispose of its ... property or any part thereof....” W.Va.Code, 24-2-12 [1984].
The reason should be obvious: when a public utility buys or sells property, it normally makes or loses money. That affects the total assets of the public utility, and thus affects the rates that consumers pay for utility services. Every transaction that affects services to the public should be subjected to public scrutiny.
It is a fundamental rule of law that “[A] public service commission may look through the corporate form of affiliated corporations and probe for economic realities.... [Wjhen an operating public utility which is subsidiary to a holding company is seeking a rate increase, all of the various ways in which the parent company receives profits from the subsidiary should be considered in establishing the rate of return that the owner of the subsidiary should receive.” 64 Am.Jur.2d § 202, “Public Utilities.”
By selling the Blackwater Canyon property, Allegheny Power disposed of land that might have been used for building hydroelectric generating facilities, might have been used for the construction of power transmission lines, or might have been judiciously timbered, to generate income for the utility— or might have been sold to the National Park Service, which wants to buy the land for public recreation. The sale, which is the subject of the instant case, has generated income that could be used to lower the price of electricity paid by West Virginia consumers. That sale affects the West Virginia utility-buying public — and therefore is subject to review by the Public Service Commission.
Furthermore, the Public Service Commission has been charged with “balancing the
D.
Conclusion
Allegheny Power looks, sounds, and acts like a public utility. Accordingly, it is a public utility. I therefore disagree with the majority opinion holding it is not.
I believe that the Public Service Commission clearly had jurisdiction in this case, or at a minimum, should have allowed the Highlands Conservancy the right to conduct discovery, to see what was hidden in the smoke and mirrors. By holding that Allegheny Power isn’t a power company, the majority opinion has allowed an illusion of corporate law to defeat the obvious reality — -that the sale of the Blackwater Canyon has adversely impacted West Virginia citizens.
Are we right back where we started a century ago? A foreign corporation is “depleting the State of its wealth to build grandeur and splendor in other States,” and doing so to the detriment of West Virginia consumers. It appears that some things change; some things don’t. As happened a century ago, are we willing to sit back and letting it happen? I pray not.
I therefore dissent.
. Allegheny Power argues that it is not a public utility because it is prohibited by federal law from engaging in public utility services. This argument makes no sense — people are prohibited by law from running stop signs, but they do it every day. Allegheny Power could be operating as a public utility and could be in violation of federal law, but we will never know, because the Public Service Commission denies it has jurisdiction over Allegheny Power, and has kept the Highlands Conservancy from conducting the discovery necessary to prove that the Public Service Commission has jurisdiction.
. It appears that history is repeating itself in the Blackwater River region. The Blackwater Canyon has previously sustained massive ecological damage from the cutting of trees. At the turn of the century, the Canyon was devastated by the uncontrolled cutting of timber, and the environment suffered from the pollution caused by the resulting lumber, pulp and paper industries.
Stephen B. Elkins, the owner of several railroads and pulp and paper mills in the Blackwa-ter River region, disputed that industry had caused any damage to the environment in a December 20, 1909 letter to William A. MacCor-kle:
Dear Governor MacCorkle:—
You are on the Commission, and I believe the Chairman, appointed to look into and make investigation of the pollution of the Ka-nawha and Gauley rivers. Under this authority I believe your Commission has undertaken some investigation into Cherry river at Rich-wood, where there are situated some pulp and paper mills.
At first it occurred to me perhaps your authority to look into the pollution of the Kana-wha and Gauley rivers did not authorize you to go up as far as Cherry, in any event, I want to assure you that the pulp and paper mills at Richwood are doing all they can to avoid the pollution of the river at that place.
Prior the establishment or building at that point, there were never any use made of the water and there were no fish in the stream.
The investigation of your Commission has caused some uneasiness at Richwood and vicinity, and affects to some extent the development of that part of the State; I mean the extension of a branch line of the B. & 0. Railroad. Now, you know it would be a great damper on future industries if these mills were compelled to close down on account of the supposed pollution of the streams.
Will you kindly look into this matter and write me, so that I may know what to say to some Railroad friends. I think it important that nothing occur which would prevent the extension of a railroad in that vicinity.
Veiy truly yours,
/s/ S.B. Elkins
Elizabeth M. Hulett, The Elkins Letters (1995), citing 99 Stephen B. Elkins Letter Books 341-42 (Davis & Elkins College Collection, Elkins, West Virginia).