*1 have become if disability,' any, cause of his to be worse. remanded cause reversed and the judgment Com- remand court with directions

to the trial consistent findings appropriate entry mission for herein expressed. the views Pringle concur. and Mr. Moore Justice Justice Mr. 21136. No. et Power Company,

The Western Colorado al. Public Utilities et of Colorado, State al. (411 785) P.2d February 14, Rehearing 1966. denied March Decided 1966. *2 Barry & Baucom, Irvine Loesch & Kreidler, plaintiff Colorado Western error The Boyle, *3 Company. Power Kelly Bryant O’Donnell, Stansfield, & Lee, Bryans, plaintiff Company of Colorado. for in error Public Service Attorney Frank E. General, W. Hickey, Duke Dunbar, Deputy, in of Trunk, Assistant, for defendants N. Robert Public Utilities Commission of the error State Colorado, et al. John A. Raphael Hughes, Conway, J. John J. Moses, R. for defendant in error Colorado-Ute Jerry Bennett, Inc. Association,

Electric En Banc. opinion delivered the the Court. Moore Justice

Mr. parties We will refer as follows: The West- to Company ern Colorado Power the Public Western; Company of Service; Service Colorado as Public Commission; and Public Utilities Commission as as Colorado-Ute. Association, Colorado-Ute Inc. Electric application May an filed 11, On Colorado-Ute Convenience a “Certificate of with the Commission for object application Necessity.” was to and of the Hayden, permit Colo- construct near Colorado-Ute to generating plant a nominal rado, a steam electric together rating with associated kilowatts, 150,000 necessary to facilities transmission lines and related sought power certain new customers deliver Colorado-Ute serve at On wholesale. June petition authoriz- an order filed for of the ing payable United States of *4 past, generating had maintained electric facilities and adequate transmission lines and related facilities and present to meet sufficient and needs all future of their customers and service and areas, held themselves out willing ready, and able to render wholesale electric any service to of its members; Colorado-Ute necessity need there did exist nor for the con- plant proposed of Colo- and facilities struction construction was authorized and that if rado-Ute such dam- would result in Commission it substantial age companies electric and their consumers. to the hearing,

Subsequent the Commission entered plant authorizing Hayden order construction of the financing denying authority con- but and thereof, originally requested. West- struct certain of the facilities ern and Public Service thereafter commenced proceedings

certiorari judgment court, in the from the district affirming decision, therein the Commission’s entered, they bring writ error here. incorporated co- rural electric

operative engaged generating and trans- association mitting energy proposes electric as a It wholesaler. energy sell electric various customers it denominates Bureau Reclamation, “members” as well as to the proposes nonmember. It facilities further to dedicate its necessity to whatever use require, including convenience and wheeling power protestants federally Public Service and Western. It is financed by the Rural Electrification Administration under the (Title 901). Rural Electrification Act of 1936 USCA VII, Eleven members” of its members are “distribution energy directly distribute to their Of electrical users. Valley two the Arkansas & T members, other G the generates energy transmits for its three “distribu- Project Agricultural members,” tion and the Salt River Improvement provides and Power District both electric surrounding Phoenix, water in the area cooperative quasi- Arizona. Salt River not a but is a governmental organization incorporated under the laws State Arizona.

Both Public Service and Western have been render- ing long prior electric service in Colorado since incorporated was first time Colorado-Ute ever con- any generation and structed transmission facilities. West- general ern in southwestern in the serves Colorado area *5 Durango and Public Service Colorado, Paonia, slope large Colorado, eastern serves in area of the portions including of western as well as Denver, Valley, Junction, Luis Grand Colorado such as the San specific areas the state. and within Rifle, other and of Western On this writ of contentions error, (1) categories: general Public Service fall into three prove need, demand, That did not Colorado-Ute necessity required by and convenience the law of Hayden necessity power provided by Plant; (2) arrangements the financial illegal; Rural Electrification Administration (3) evidentiary, pro- and that numerous errors of cedural, committed and were administrative nature prejudice all to of Western Commission, Public Service. category sub-categories,

The first consisted of six points each which, said, it to error because action of in affirm- trial court Commission, ing the Commission, contravened the fundamental con- cept public utility relating convenience law necessity. respect (1) In this asserted: That proposed the evidence established that new customers already adequate supply power of Colorado-Ute had an merely change and that these customers would their taking power source and commence their from Colorado- (2) plant dupli- Ute; that the construction of would cate service made available Western and Public suppliers presently as well as other electric Service rendering (3) power such service; that the estimates of support costs submitted Colorado-Ute found no (4) generation the evidence; that the and transmission energy assuming cost, at less the record established establishing public is not factor in fact, such con- necessity upon cheaper where venience reliance energy basis for certification would be destructive concept regulated monopoly; (5) that it would permit be in interest the construction put a debt plant Colorado-Ute in it would where (6)

position 100%; more than concerning alleged receiving benefits erred in evidence *6 Basin fund River to the Colorado which would accrue plant the the where of a the construction as reception result of con- the based such was of evidence basing plant decision 600,000 struction a k.w. of only plant application of for a the was thereon when 150,000k.w. (by vote) found

The Commission to one a two necessity the con- demanded convenience and Hayden and its related facilities. struction Plant subject by writ of This is the of attack determination eight error in court. record of some this consists pages twenty-five pages of hundred thousand with over twenty-four testimony. exhibits were One hundred lengthen opinion unduly to dis- offered. It would presented, and cuss in each facet of evidence detail the necessary is not to do so. it organ- The record Colorado-Ute was discloses group ized in 1941 a of distribution rural electric Slope, inac- associations on Western but remained reorgan- years. for In tive some 1952 Colorado-Ute was ized, a from the Electrifica- and it obtained loan Rural tion Administration to construct transmission lines generating plant supply requirements a electric completion Upon of its then members. the con- of plant, plant, struction known Colo- of this Nucía serving, rado-Ute commenced on basis, wholesale four cooperatives distribution located in the southwestern portion hearing the state. At time of the before pending application then an the Commission was there serving fifth member Colorado-Ute commence Junction, near Grand Colorado. located alleged purpose to served construction plant supply require- Hayden is to electric but of its five members thirteen ments not of members. making have the effect of This would Colorado-Ute the large portion energy supplier ato wholesale of electric portion to a small as well as Colorado, the State of Wyoming Utah, and State and the State Project large Each supplier in Arizona. the Salt River eight potential Colorado-Ute customers of new of these receiving sources, from other is now adequate to existing Plant of Colorado-Ute Nucía members. It requirements earlier of the five serve the ren- apparent commence that Colorado-Ute seeks thus dering expanded areas basis in electric service on has never to customers served, heretofore it has not where areas customers and before and to served, being supplied available and is electric service is existing other sources. proposed many service to

Wholesale electric cooperative customers new distribution supplied by many years in the utilities other *7 all Reclamation, Bureau of area, and later proceeding distinctly in the whole- parties to this are organiza- & T Arkansas is G business. sale electric supplies wholesale similar to Colorado-Ute tion cooperatives. Ar- three distribution service to electric purchase Valley power by mu- from its kansas obtains generating plant nicipal plants electric and from its own City. This, turn, it wholesales. located near Canon decision is to substitute of Commission’s The effect supply all these for of as the Colorado-Ute source receiving proposed For those instance, new members. will Bureau Reclamation from the service wholesale proposed purchases; customers new those terminate such plants plants dispose generating will of those which have n another; and new customers those means one longer municipalities purchased do will no which recently completed only & T, G which Arkansas so. plant, City generating will no Canon of its

construction plant any power longer own but instead from its obtain purchase from Colorado-Ute. will testimony conflicting with

Although much was there ability Reclamation respect Bureau of of the requirements of the meeting the wholesale continue Com- Colorado-Ute, all three proposed new members —power finding Bureau in a concurred missioners coopera- many supply existing these source of — addi- adequate In future. foreseeable tives was & TG clearly that the Arkansas reflects tion plant record anticipated adequate meet the than is more period of for a considerable demands of its customers Public Service record that It also shown time. generating adequate facilities and Western have require- wholesale to meet demands which existing respective sources should in their areas ments prove insufficient. apparent circumstances,

Under these suppliers capabilities existing generating electric adequate supply more than of Colorado State the addition electrical needs without increased only plant, Hayden for the was to be constructed purpose providing that al- to substitute for being ready rendered. need for

Confronted with the fact that no there expand operations to serve customers being concurring already Commissioners served, two theory pick evolved a that such new customers could (1) continuing between service from exist- choose ing (2) purchasing suppliers, requirements wholesale (3) pur- utilities, from certificated investor-owned chasing or authority *8 from Colorado-Ute if it obtained plant. Hayden 'by construct This is shown the fol- lowing statement of Commissioner Horton: applicant interpret

“That herein Ute, the as we power from record, has elect three sources of avail- present able to take of their care future needs: purchase power “1. To the investor-owned util- represented ities herein; Protestants “2. To avail Bureau from The themselves of Power Storage Project; Colorado River Hayden.” plant

“3. To construct a steam electric at QUESTION'S BE TO DETERMINED necessity require Does First. convenience and operation Hayden plant the construction and of acknowledged existing adequacy view the service? of of question negative. answer We long prin State of Colorado has been dedicated to the ciple “regulated monopolies” of in the conduct of utility operations. principle This has been the policy year of this state since the 1913 when the Public adopted. Utilities A'ct State Colorado first concept long has never varied in a of decisions line upon of this court. We will comment of those some opinion, decisions later in this but here it is observed recently September that as 13, 1965, in the case Transportation Company Colorado v. The Public Util ities Commission the State Colorado, Colo. again 405 P.2d 682, this court reminded the P.U.C. of the concept regulated monopoly as follows:

“It probably would seem to us that the real reason falling for the Commission’s into error in the instant case comparatively is the fact that even at this late date professes regu- utility uncertain toas whether lation of theory motor carriers in Colorado is based ‘regulated competition’ ‘regulated monopoly.’ during As hearing, thereof, illustrative course opined one Commissioner as follows: “ peculiar ‘We have a hardly situation I here and know con'cept, how to rule. Our (sic) federal Ias under theory regulated has competition. it, been on the If — you can concept tell what the me Colorado I don’t got rulings ways.’ know. We have both indicate findings “And then in its and order, formal the Com- mission stated as follows: “ [Public ‘The Colorado Utilities] for the Commission, past twenty years, regulated has motor carriers for hire

272 competi- regulated theory belief

under the that the compliance not at- We will tion with our law. appear tempt question it is would resolve as it this jurisdiction beyond our which feel is matter law we ** *’ courts. should left to the competing the the “It is late merits too to debate ‘regulated ‘regulated competition’ principles and of Despite utility regulation. monopoly’ in the field uncertainty Commission, of the State claimed regu concept long has been wedded Colorado utility regulation. monopoly field of lated in the many Commission, For benefit a few of Ephraim Freightways, say v. Inc. are: so, cases which 228; 596, P.2d Utilities 151 380 Commission, Public Colo. Commission, 145 Colo. v. Public Utilities Donohue & Railroad 359 Denver Rio Western 1024; P.2d Grande 351 142 Commission, Co. Public Colo. v. Utilities Commission, Utilities P.2d and Archibald Public 278; worse, 421. better or for P.2d For Colo. prin definitely quite is committed Colorado then, regulation upon ciple public utility is based ” ‘regulated monopoly.’ theory of a great adhering many other cases There are regulated monopoly principle purpose would and no Suffice here reference to all of be served them. clearly regulated say that these cases show that to monopoly theory principle not consistent with the concurring Commissioners which the two case based their decision. which determinative of basic

The statute issue provides as 1963, 115-5-1, case is C.R.S. follows: — (1) No

“115-5-1. New construction extension.— public utility begin new fa- shall the construction aof cility, plant, system, fa- or or of extension of its cility, plant, system, having obtained or without first present commission from the certificate necessity require will future convenience require such 115-5-4 115-5-1 Sections construction. any corporation *10 require not be construed to shall to city any secure such for within certificate an extension county city or or town which shall have within it operations, lawfully an theretofore commenced or for territory, city extension into within or either without county city contiguous facility, or or town, to its plant, system, line, or and not theretofore served public utility providing commodity same or serv- already territory ice, or for an extension to within or necessary ordinary served of its it, in the course * * *” business. proof mandatory above statute makes necessity prior convenience and construc plant system, subject tion of ex certain new ceptions. exceptions It is obvious that none of the applicable in this never and Colorado-Ute has case, contrary. contended to founda This statute is the regulated principle monopoly tion of the and as this designed many court has on observed occasions it was prevent duplication competition be facilities and tween utilities, and to authorize new in a field utilities only existing inadequate. when ones are found Ephraim Freightways, v. Public Commis Inc. Utilities sion, 151 596, Colo. 380 P.2d Donohue Util 228; v. Public ities Commission, 145 359 499, 1024; P.2d Public Colo. Company Service v. Public Utilities 142 Commission, 543; Colo. 350 P.2d Public Utilities Commission v. Donahue, 285; 138 335 Colo. P.2d Public Utilities Commission v. Loveland, Colo. 289 Pac. 1090. Zarlengo correctly It is our view Commissioner understood force and effect of statute and its application the issues in this case indicated following quotation from his dissent: objective

“It is that the obvious of the statute is to duplication power avoid of sources of in the in- consuming public pay Why for, and

terest. should the power 3or will do, if maintain, two sources of one power law, there- do, etc., if will etc.? sources of fore, expanded, subjects proposals construc- new, or for judgment in such tion to showing Applicant make cases must affirmative purpose be defeated. will not of the statute that the tip Applicant the scales’ ‘to “It is incumbent duplication not result will in the direction that doing proposed must show that In this action. construction is a need for additional there necessarily existing showing sources involves reasonably adequate and available.” are, will, not be previous impossible court reconcile its It is pronouncements statement of Commissioner with the *11 pick could and choose that Horton utility serv- in which it availed itself of manner furnishing important ice, kind which is the one years performed many power, a service for wholesale protec- by protestants, as entitled both and one monopoly regulated other. tion its status Allowing pick from whom and choose customers to obviously they any public utility will obtain duplication, prevents rather rather fosters creates then disregards competition, totally and than controls principle inadequacy existing be must that facilities a new shown in order to authorize service. initially appears the record that Colorado-Ute It from satisfy recognized required basic it was these necessity principles and if it were convenience produced prevail. effort was in an Much evidence have did not the Bureau of to show Reclamation power requirements of 'Colorado- sufficient to meet the proposed each of indicated, new As Ute’s customers. contrary, and to found to Commissioners three proof complete lack of of this essential illustrate ingredient necessity quote convenience and we from the Commission’s decision.

Commissioner Horton stated: “* * * power However, the Bureau Ute that assures energy preference will be made available to them as Congress, customers Act of River from Colorado Storage Project.” Bjelland agreed following language:

Commissioner in the “* * * clearly Even as record the fact establishes power, clearly equally that Ute needs estab- more lishes that Ute’s immediate reasonable future needs and by purchasing hydroelectric power needs can be satisfied Project. from the Colorado River member Ute and its cooperatives preference power are customers for from project, preference power Upper Divi- fully sion States will in all liklihood be utilized power until the mid 1970’s. This source is stable * * *” price (Emphasis supplied.) is reasonable. Zarlengo, Commissioner dissent, his stated: “Giving testimony upon consideration to all of the point, requirements this ern it is obvious that the North- preference they

Division customers which en- titled to obtain from the Bureau of Reclamation under preference supplied laws of the United States can Storage Project the Bureau the Colorado River through year perhaps through (Em- 1975.” phasis supplied.) capacity ability

The evidence of the of Arkansas Valley supplying requirements customers’ continue clearly existing established the record. Thus, *12 supply proposed sources of new customers conclusively adequate. Colorado-Ute were to be shown It should also be noted that the determination of the adequacy existing giving sources was made without potential suppliers consideration to other such as plaintiffs ready, willing in error who were and able respective render this in their service areas. agree Zarlengo points

We with Commissioner when he dissenting opinion evidence lack of

out in his necessity: and convenience applicant case, appears its founded has “It that the Hayden Plant premises if the on the main, produced energy power and authorized, the facilities be ignoring substantial while market, will find a all the (58) availability proof competent evidence as existing energy non-availability power con- cost to the of its and the reasonableness sources phase, glossed say over this has least, sumers. To or, most, vague, indefinite evidence which is tendered at uncertain.” author the decision of the To affirm Hayden plant exist izing ing where of the the construction require already adequate, a com would service was previous plete departure by decisions. court from its misconception The fundamental existing sup regulation, recognize that, under failure to pliers desiring whether service, serve all are entitled to early they existing potential In our customers. supra, Company Loveland, decision in Public Service utility existing protected right render we though potential customers even electric service to serving utility A case in recent them. then Verl point Commission v. case of Public Utilities is the Harvey, 371 P.2d where 150 Colo. Inc., expanded granted a certificate for Commission had existing finding operation without motor carrier perform inadequate the de or unable to carriers were protested existing had sired carriers service. The they expanded authority sought because Watson one perform willing ready, the service and able to were though then were even customers involved none following quotation from that served them. The opinion particularly issues here: suited to the grant- opposition to commission in

“Presented to the ing any authority was the contention to Watson protestants, supported by evidence, that uncontradicted *13 ready, willing licensed carriers were to fill the able requirements shippers, including of those needs using who have been Instead of the service of Watson. making finding were that additional facilities were or answering expressly not needed, the commission avoided very important question, this and stated: “ Applicant provide ‘That the which services seeks to necessary necessity for the convenience and though (though allege even there are other carriers who record) the Commission does not so find from that they adequately can the vacuum which would re- fill ” operations by Applicant.’ sult from cessation of

The decision of in Util- this court v. Public Donahue supra, significant particularly ities Commission, is also in view of the contentions here raised 'Colorado-Ute. In that case the Commission had failed to find that by existing granted inadequate carriers was but authority requested on basis that there was support sufficient business to the new In re- carrier. jecting concept and neces- convenience sity, again adhering requirement to the absolute inadequacy the Commission before of service find granting a new we certificate, said: “* * * * ‘* * finding by nor commision that, say [protestant’s] can adequate we that his service is finding at time,’ falls far short of a rea- of failure sonably supply the need. com- There is not sufficient petent evidence this record to warrant find- such ing. finding question’ which is called the ‘serious confronting namely, the commission, there ‘Is sufficient business warrant two certificated carriers?’ amounts repudiation concept upon ato basic Utility powers structure of Public based, namely, regulated monopoly.” that all,

All in review on of the record and con- the two curring opinions majority of the Commission, it apparent that no real effort made to decide this pertinent a manner case consistent with the statute

(C.R.S. 115-5-1) many constru- decisions our approach ing interpreting “non- Instead, it. regulation” appears employed, from the follow- *14 as findings: ing quoted statement from the Commission’s assume Commission should “We not feel the do speculation matter to thou- on a so the burden of vital has Board when the Colorado-Ute sands of consumers Hayden management the to construct made a decision Plant.” Freightways the Consolidated

Our statement Corporation case of Colo. Commission, Public v. Utilities repeating: 406 P.2d bears 239, 83, — n — “Regulation non-regulation been declared not has be in interest.” the presented by summarizing the In the factual situation apparent record, that, it is already adequate

1. available in service is electric of the State of Colorado for the needs and necessities proposed Colorado-Ute; therefore the new customers of Hayden requiring an 2. construction of the Plant, the thirty approximately dollars, investment of million necessary supply any present or fu- foreseeable ratepayers requirements, and ture electric Colorado support required it; should not be judgment 3. of court’s and the affirmance the district duplica- decisions of the Commission would sanction existing adequate to tion of electric which facilities are supply public; and the needs of the

4. the of and Commis affirmance district court sion decisions this court would be inconsistent regulated monopoly as we would, the doctrine of Harvey, Verl Public stated in Utilities regulation “wholly supra, and mean render ineffective ingless.”

Having law Public Con- discussed Colorado Necessity point upon venience which crucial inquire must in this we whether turns, the decision case should, there other which considerations special absolve case, reasons to this proving necessity convenience that the plant. Hayden If necessity requires construction at be admitted exist it must such considerations concept of would the result emasculate outset monopoly regulated Colorado structure and the entire utility law. 115- ch. 198, Does Sess.Laws Colo. SECOND. jurisdiction generally co- 1-3(2), over conferred operatives Commission, Utilities violate Public United States? Colorado Constitution negative. question At in the This is answered court case, consideration commencement of its argument from requested oral additional and received an constitutionality concerning upon questions counsel, (particularly Laws Session of the 1961 amendments Utility 115-1-3(2)) Public Colorado ch. *15 consequent Public Util investiture of Law, and the cooperatives. jurisdiction of ities Commission with argument Colorado- of this Prior to occasion oral constitutionality Act, questioned had Ute application and fol- filed before the Commission had through court, district Commission, the matter lowed suggesting unconstitu- and tionality. in this court without briefs regulate a power with entities affected power police public of the is of the interest a function any activity with which is affected state, business or regulated. public may be classified and a interest so so People, Nebbia v. 885; 124 238 P.2d 454, v. Colo. Eachus 113; 94 Illinois, Munn U.S. York, 502; New 291 U.S. v. (Idaho Light Blomquist, 141 1083 & v. Pac. Idaho Power Membership Corpo County 1914); Rural Electric Boone Indiana, v. Public Service ration, et al. Kentucky Utilities 121; 525, Ind. 159 N.E.2d al., et 239 Company 885 Commission, S.W.2d Public v. Service Dairyland Cooperative 1952); (Ky. Brennan, Power v. Utilities 56; Minn. 82 N.W.2d Public Orndoff 135 Ohio 21 N.E.2d State 334. Commission,

The record shows that Colorado-Ute in whole saling power electric intends serve classes various including consuming cooperatives, of customers other wholesaling governmental cooperatives, quasi-govern or (Salt River), mental bodies and even arm of the Government, Bureau Reclamation, Federal to gether applicants approved other for if hold the Commission. We its business is af public subject regula fected with a interest and police power Colorado, tion under the of the State of regulation and that such does not either the violate Constitution of State Colorado or Constitu tion of the United States.

The 1961 amendments the Public Utilities Law of the State valid, of Colorado are and consti- enforceable, 115-1-3(2) provides: tutional. C.R.S.

“Every co-operative nonprofit electric or association, corporation sup- every association, electric other plier energy, supplying of electrical whether electric energy for use of the of its use hereby own members, declared to be affected with public utility interest and to and to be subject jurisdiction, regulation to control, provisions commission and of articles 1 to 7 of chapter.” cogent This statute is couched in clear and terms. It exceptions. “Every co-operative makes no asso- electric utility, ciation” is well as all other electric *16 suppliers.

No has been issue raised in this case that Colorado- “co-operative By Ute not a is electric association.” subject “juris terms of statute, therefore, to the is regulation” diction, control and of the Public Utilities Commission, and we so hold. application

Colórado-Ute in its Public before the Util-

281 utility. public readily that it is admits Commission ities following: application The contains existing organized corporation “Applicant is a Colo- ’State of under and laws virtue subject jurisdiction under this Commission rado provisions passed the Colorado 245 the Legislature of H.B. No. April signed by 23, on the Governor * * * 1961. necessity requires public convenience “The generating plant, lines, transmission construction of said herein interconnections facilities, and related and the described.” concept allegations only with the consistent

These utility, and are inconsistent is a Colorado-Ute only needs with the idea that it is concerned co-operative requirements members. of its admit that Western and Public Service public utility. legislature no has declared The utility. furnishes It uncertain terms that it ais energy consumers which is used countless electrical widespread large segment very in a of clearly this state. court and this shown, interest of the espe- legislative act to be void, not declare the should parties cially valid admit that it is when the themselves and enforceable. authority support is an abundance of

There energy distributors of a classification wholesaler public utility. Co., Service North Carolina Public as a County 837; Power 282Fed. Boone Co., et Rural Electric v. Southern al. Membership Corporation, v. Public et al. Company Indiana, 525, et 239 Ind. al., Service N.E.2d Ohio Commission, 135 Public Utilities 121; Orndoff Company Industrial Gas 334; N.E.2d State 135 Ohio St. Ohio, v. Public Utilities Company v. Traction Green 166; Wisconsin N.E.2d Bay 205 N.W. 551. Co., & 188 Wise. Miss. Canal obviously organization co-operative has form of nothing question do of what constitutes to with

282

public obligation necessity, convenience and or with the any prove necessity utility public convenience regulated monopoly theory in accordance with as expressed by the statutes the State of Colorado of this court. were decisions These statutes enacted public for the benefit of as a and result in whole, granting regulated supplier com- status to a of a modity public regula- essential to Under interest. an consumer need a tion, electric not be member of co-operative to secure its service. a consumer Likewise exclusively co-opera- located an area served such tive must take its service if re- indeed service is to be organization delivering ceived at The form all. serv- ice makes no difference whatever to consumers these legislature recognizes reality specifically and the when it places co-operatives regulatory under the arm of the state. long ago

As court, 1926 this case of Davis v. Public Utilities 79 Colo. Commission, 642, 801, 247 Pac. examining activity that in affected with determined public ignore interest it look would to substance and form. In that the court said: case determining

“In whether a business com- of a important thing mon carrier ‘the does, is what it not says.’ what its charter Taxicab Co. Kutz, Terminal Sup. et 241 al, U.S. Ct. L. Ann. Ed. may (sic) 765. A 1916D, Cas. effect ‘so consider- able fraction of the that it in the same may sense pub- in which other . called so-. The . ” everybody lic does not mean all the time.’ wholesaling power That of electric is affected with a interest is well illustrated the fact that if it spin were Public so, or Western Service could off generation their and transmission functions a sub- sidiary corporation, regu- and thus evade defeat the power lation of thereby rates, wholesale the rates Certainly legislature ultimate consumer. no co-operatives the case this result in more intended utilities. investor-owned in the than did case co-opera- Colorado-Ute, THIRD. Does the fact *18 co-opera- also members who are has but thirteen tive, kind than that warrant treatment tives, of different any mem- applicable kind other to which would be bership? negative. question We answered in the This is argument co-operative that as a merit no to find co-operatives, is are other whose members adjunct merely member co or an extension these operatives members, and its act act of so that its subject regulation. to not that reason Colorado-Ute is respects Colorado-Ute is in all first that

We observe corporate separate legal entity; distinct a organization, has its own including and it officers; directors co-operatives not, or whether customers, deals with its power supply long It is contracts. term means Hayden plant to construct the obvious that decision rather than its was the decision Colorado-Ute itself build decision made to members as the time plant. Hayden had more than At that time it no (cid:127) Many not of its new members did be- five members. purchase agree power come or contracts members shortly hearing commenced, before the Commission until plant long construct which was after decision to apparent Colorado-Ute, It is, therefore, was made. ego being members, alter of its instead destiny. concept complete own master Thus adjunct of the distribution of it as a mere extension legal co-operative has members no factual basis accepted we is a forced and artificial one. But even if of the nature of Colorado-Ute artificial idea appli- ego, speak, different members, so of its no alter legal principles here involved would result. cation of the There is no case that those customers contention n co-operatives of Colorado-Ute that themselves are subject jurisdic- utilities and. are not

tion of the Public Utilities Commission.

Any gen- co-operative, such which had not theretofore electricity, required erated its own secure would be approval proposed if it to construct such plant (CPUS. 115-5-1), and if it came of course purpose before the Commission it, like such utility, required prove other would be that the necessity convenience and demanded such construction engaging wholly because it would then be in a new and type utility (generation) distinct theretofore supplied by public utility providing “a com- the same modity or service.”

Similarly, go Colorado-Ute did not the Com- before seeking existing mission to extend serve facilities to existing clearly customers. record it had shows ample existing facilities serve all of its then customers *19 purpose application expand and that the of its was to its service from a small area in southwestern Colorado substantially Slope many to cover all Western as well as square portion thousands of miles the southeastern in of the state. closing

In the discussion of the nature of Colorado- may suggested it Ute, be remarked that its status anas adjunct co-operatives of its individual is belied what co-operatives occurred. None of the distributive were parties proceedings representatives and their did appear give not before evidence their own behalf that the convenience and neces- sity required Hayden plant, construction of the and this supplied by speculation part lack cannot be mere on of either Commission or court.

Secondly, by any is not means “a co- operative cooperatives.” already As we have noted, thirteen of its members eleven are distribution co- operatives, co-operative one is a wholesale of a nature similar to that of Colorado-Ute itself, and the thirteenth — — largest far the of all of its members Salt

285 agency governmental quasi-governmental River, is a completely other from that of all different nature members. clearly apparent Colo-

It that the business of is thus special beyond interest far rado-Ute is affected with a co-operatives and there- that its eleven distributive regulation. fore is not immune Hayden plant has FOURTH. Does fact already completed require been an affirmance of judgment trial court? The answer is “No.” The court is aware

Hayden plant however, fact, now constructed. This is legal principles cannot de subvert our cision based be allowed to defeat doctrine nor regulated monopoly which Colorado subscribes. It financing clear that both REA, Colorado-Ute and the (who Commission) recog not before the associate Hayden during plant nized that construction of the liti gation they en risk, was attended with substantial activity knowledge pos gaged such with full consequences. sible good

For no contention is reason, made that precludes construction decisions It is the court. law that when the interest is concerned only right duty appellate it is but the of an court regardless to determine the of interim issues, construc v. 129 Colo. 267 P.2d 1014; tion. Reserve Leo, Bruce Company, Texas Dallas, Insurance v. Frankfather, Life People 1035; v. rel., Colo. P.2d Golden ex 715; 101 Colo. 74 P.2d Pallas v. Johnson, Colo. Producing 559; Jackson Denver 449, 68 P.2d and Re *20 (10th 1938); Company, fining 96 F.2d 457 Circuit South Company ern Terminal Commerce v. Interstate Pacific 55 Commission, 310; 219 U.S. L. Franks 498, Ed. v. State Highway 182 Commission, 160Kan. 535; 319 P.2d 131, Kan. Moore Smith, 675; 160P.2d v. White, Moore P.2d 352. Okla., 323 solemnly assured

Colorado-Ute the Commission and the reversal of district court that in the event the con- Colorado order, Colorado-Ute escape sumers would from adverse economic scatheless consequences then because River Arizona would Salt obligation plant. Hayden record assume the for the wrote the Com- discloses counsel Colorado-Ute specifically March mission under stat- date ing agreed Hayden plant that Salt River had to take the off the hands loss in the at no to Ute subsequently event that “some court” ruled that should not be issued. certificate applicant The district court warned and its members participating possible and its financiers of conse- quences proceeding pendente following lite, in the language: cooperative willing pledge

“If the members are their credit and the United States and River Salt Project prepared spend money to build this upon expectation Plant in Colorado their de- cision of the Public Utilities Commission will be sus- progress during tained in the Courts, the work litigation appear damage would to cause no in law anyone.” unlikely In the event of loss will not be borne electricity, ultimate consumers of but will fall go notwithstanding those fit to who saw ahead mani- uncertainty pro- position express fest of their and visions of Section of the Rural Electrification Act Congress provided: which the of the United States operation, “That no loan for construction, or en- largement any generating plant shall be unless made authority having jurisdiction the consent of the State premises in the is first obtained. Loans under this sec- tion and section shall not be the Adminis- made unless judgment trator finds certifies that in his se- curity reasonably adequate therefor and such loan repaid agreed.” will be within the time litigation When in accordance with statutes and *21 procedures progress, question in it of in the state authority no that consent needs citation of to establish authority been the state to construction has person any ncr could reasonable obtained, security believe -proposed adequate and that for the loan is right very repaid loan will be in course when the due litigation. plant Court The construct the is still in Appeals examine had for the 4th Circuit occasion County questions Greenwood related case of Company, at Power Fed.2d and said Duke pages 488-489: question Works

“The the Public as to whether law grant lawfully Administrator could make a loan and county project a this such as construction of opinion upon was a of able new one and which the one lawyers judges and It was in interest was divided. parties question of all authorita- concerned that the be tively expendi- settled before were and monies advanced * * made tures “* * * raising pendency such of the suit mere questions prevent was sufficient advancement irrespective funds an States, of the United officer granting injunction.” temporary concluding opinion

Before desire to we make additional decision comments on the Commission’s purpose guidance. for the of future reference primarily finding body has fact any, appellate few, if It is attributes of court. required by findings law to make of fact judicial necessary review of its actions can predicated. findings In case, instant the lack of arising fact the Commission and the confusion separate respective statements commission any, agreed upon by what, ers as to if were facts regulatory body, grave Commission as a have had consequences. get

In order the matter before this the lack court, proper findings required prepare first counsel to next appendices briefs and exceedingly file long Both of drudgery. massive amount caused this court delay disposing have contributed to of these results *22 interest. great public case is with a which affected of the court is reversed and of trial the judgment it judg- vacate its cause remanded directions Commission to vacate and thereafter direct ment No. 60156. set aside its decision the result. Justice concurs in Mr. Chief Sutton Mr. Justice Frantz dissents. Justice Frantz dissenting:

Mr. be, cannot what it that Colorado-Ute is By holding sup- as the has it majority effectively incapacitated reasoning for its members. energy plier a public' is this: Colorado-Ute is majority, simply stated, is offensive public existence a utility. utility Its regulated monopolies. relating the law of this state Commis- finding This conclusion from the flows were other sion, by evidence, there supported Colorado- members of sources available from which the sources, other being could obtain There energy. Ute facilities, which a duplication is Hayden plant con- determination effectually the door closes existence, qua the sine for its necessity venience non for its justification. that Colorado-Ute court accepts premise

Once the is then said fol- utility, logically a that which public is is determination that Colorado-Ute It with lows. In opera- that I am disagreement. utility a public a public Colorado-Ute Hayden plant, tion of the from three respect in this arises view utility, my cooperative a Colorado-Ute is (1) basic considerations: members which are, made of thirteen up corporation thirteen mem- and for these cooperatives, corporate turn, sell electrical at energy manufacture bers will Commission confined wholesale; order (2) energy the sale of at mem- to the thirteen wholesale thereby removing bers, Colorado-Ute from the utility concept dedicating property serv- (3) put interpre- ice or use; and this court should not tation on the facts invalid case makes provision relating our constitutional and the statutes public utilities. operation Hayden

If in the plant, public utility, majority not a opinion is trary con- devastating legitimate would have a effect enterprise very for which there has been a substantial importance investment. The of this decision as it re- general lates in par- to our law and in utilities Hayden plant ticular to continuation of' the aas energy places heavy responsibility source of electrical upon this court.

By Article XXV, Constitution of vests Colorado *23 legislature complete authority the public with over util- * * * presently may ities “as by or as hereafter be defined laws

the of State of the . .” Colorado. stated, . For reasons position will be hereinafter I take the any public utility definition of a within must remain concept legislature traditional the term; that the may by enterprises, not fiat make which would not fall meaning within public the traditional of the term, utilities.

Presently “public utility” by term is defined stat- ute. The definitive statute is C.R.S. 1963, It 115-1-3. provides: * * *

“(1) ‘public utility’ term every includes pipeline corporation, gas common corporation, carrier, corporation, telephone corporation, telegraph electrical corporation, corporation, person municipality water operating purpose supplying public for for public every domestic, corpora- mechanical, or uses, and person tion, or now or declared law to be hereafter public with a and each interest, is thereof, affected hereby public utility declared to be a . .. co-operative

“(2) Every or non- association, electric every corporation profit other association, electric supplying energy, supplier electric whether of electrical public energy the use of use or for for hereby with declared to affected members, is own (Em- public utility .”. be a . and to a interest phasis supplied.) as be construed statute to

Were the constitution and serving public, applying private corporations not invalidity immediately because: would arise their unjustly (1) would interfere such construction private property rights due in contravention of the process federal clause of the 14th Amendment constitution; upon private infringe

(2) would such construction rights protected Article which are contractual (1) constitution; federal Section (3) derogation would such construction be in rights Enabling recognizes property implicitly Act, which private contracts. and the freedom enter into regulation only Selecting cooperatives electric protection public utility equal a clause violates the subsection 14th thereof Amendment, reason be sustained. 1963, 115-1-3, cannot C.R.S. necessary problem, In consideration of the regarding public util- to revisit fundamental law some enterprise public utility, makes an ities. What why public utility which are under some restraints public? applicable serving corporations not corporation, corporation

“A becomes subject regulation by department serv- *24 only business is when, that, extent its and to the ice, public be dedicated or devoted to a use. The test to applied corporation not the itself is whether or holds prod- supply expressly impliedly, its or to service or out, uct public a utility, as class or either use for portion or whether, that can be served itof only particular contrary, merely serve it to on the offers

291 supplied.) (Emphasis own selection.” its individuals of Department Service, Public Empire Rural E. v. Inland proposi- support of this 258. In 527, 92 P.2d 199 Wash. Washington Supreme a host cites Court of tion the Union. from states of the cases theory a recognized of law court has

Our property be utility must public idea that embraces regulated may as public be before it a use devoted to operated system public utility of works “a A such. telephone, public examples street which are use, gas light power, works, water, railway, electric 494, systems.” Haxtun, 84 Colo. Searle v. Town other 629. Pac. Corpora- in Colorado Utilities The court asked itself Commission, Public Utilities Colo. tion v.

P.2d 849: presented, Company, under the facts Moffatt Coal

“Is meaning public utility Public Util- a within the ities Act?”

and answered: “* ** Company Moffatt no dedication Coal made public property any part use; made thereof to public did hold serve offer, out, no itself to public utility statute as such term used in the as above mentioned . .” . enterprise public utility “a must To business or be * * * impressed with a interest and those en-

gagéd conduct thereof must hold themselves out serving ready public, all members serve may require capacity. extent it, who of their must be such that nature of all members of right (Em- it.” have an demand enforceable Englewood supplied.) phasis Denver, 123 Colo. 667; 229 P.2d Public Commission v. Utilities Colorado Co., 142 Colo. 351 P.2d 241. operations subject

Nowhere is difference between power regulation subject police and those utility regulation leading so well demarcated inas

292 175 Commission, Railroad Cal. Allen

case of v. language precise and 249. Since its is Pac. A.L.R. extensively: quote I from it definitive, “* * * everything upon which In its broadest sense purposes those man other than bestows labor for impressed family with his the benefit of immediate is occupation escapes public it, no merchant use. No deny professional can As an man it, can avoid no it. type may deals He the illustrative instance butcher. one public urgent public; that with he invites the and business is him. The character his should deal with may police power under such that state it subject places regulation, many and well be regulated. preservation of cleanli- instances is so they inspection whole- ness, the of meats to see are due such and reasonable some, all matters are within powers regulatory these But nation. state powers regulatory because not called into exercise public property his service has devoted butcher public utility. un- has the so to make it still He right prices; questioned un- fix his still he has right say questioned contract that he not will will public. all What differentiates with member of the public utility this, these from true activities public only: must be of That the use devotion public part generally, or that such character accepted of it which has been served and has right shall to demand that that service has service, long as it is conducted, continued, so reasonable charges. efficiency use, then, Public under reasonable by every individual means the use legal right.” (Emphasis supplied.) as a it, member plant utility “de- is a Whether electrical powers pends upon con- what it does not Corp. upon it charter.” Colorado Utilities ferred v. supra. commonplace Commission, Public Utilities It is private corporation “a cannot be con- doctrine that corporation legis- by mere verted into a thing, important what fiat. What it does is lative Empire says E. Rural it, Inland state, or the it is.” Department supra. Public Service, *26 statutory enterprises provision “affected with that public public mean- narrow interest” are has a utilities concept ing— keeping customary of in with the one public utility. what statute constitutes a “Under our operations defining public pipe-line must utilities, Cobb’s impressed public so be with a That it is not interest. impressed plain- readily determined the fact that public, right here, and tiffs have to demand no * * * principles It a reiteration of the laid service. Englewood supra, say down case, in before operations public Cobb and his could be as a classified utility, serving, ready he must hold out as or himself may public require serve, who it.” all members of (Emphasis supplied.) Parrish v. Public Com- Utilities 134 301 P.2d mission, Colo. 343. limiting scope term,

In so “affected public harmony interest,” our court is in with the much-quoted language definitive former Chief Justice Packing Taft in Co. Court the case In- Wolff dustrial 262 U.S. 43 S. Ct. Relations, 630, 67 L. Ed. approved People 1103, 27 A.L.R. and followed in ex rel. Industrial v. Aladdin Theatre, 527, 44 P.2d Colo. 1022: There Justice Taft said: public “Businesses said to be clothed with a interest justifying public regulation may some divided into be classes: three

“(1) authority Those which are carried on under the public grant privileges expressly of a which either ¿ffirmative imposes impliedly duty rendering public by any public. service demanded member of the pub- Súch are the railroads, other common carriers and lic utilities.

“(2) occupations, regarded exceptional, Certain attaching public recognized interest to which, period arbitrary times, earliest has survived the laws regulating legislatures all colonial Parliament or keepers of callings. and are those trades Such [citing gristmills, cases] inns, cabs, though in- “(3) at not their which, Businesses ception, may fairly such, be risen to said have govern- subject consequence some have become pe- They regulation. such a hold have come to ment superimposed public that this is culiar relation to the language owner, cases, In the them. grants devoting effect, use, business to the his subjects himself use, in that an interest al- public regulation of that interest, extent to though belong private property to its continues to accordingly.” protection and to be entitled to owner, general application co- appears to be a rule of It pub- serving only operatives members are their own page 1498. A.L.R., at Annotation in lic utilities. See hold they others, *27 if their members serve But majority willing the others, to serve out as themselves rule they public Idem. appears are utilities. to that be Commission, Service Power Public In Garkane Co. v. same the 1490, 132 100 P.2d A.L.R. 98 Utah —case “the in our court as confronted the situation prohibited specifically render- corporation ing [was] only public”; its serve could or it service for to cooperative a holding not In members. utility, Supreme public uttered these of Utah Court words: “* * * only long cooperative own its serves as a So right long select to it has the and so owner-members ordinarily not it matters members, become those who that the all people few or members or that a are membership, given people accorded area are of a cooperative arrangement provided bona fide is a prepared organization a device private and is not operated or circumvent law.” evade to Coop. Public Inc. v. Socorro Elec. effect, like see To 348 P.2d 88. N.M. Co., 66 Service corporation, cooperative To hold that a created incorpo- manufacture sell at thirteen wholesale public utility cooperatives, rated who at is a retail, sell by giving strange statutory definition a and uncon- meaning place unconstitutionality. ventional leads To corporation purposing a not indis- serve (1) criminately public utility in the of a means status physically it must sell whom can to all it serve being right rather at than retain constitutional its liberty pleases, (2) that, to contract whom with although operation property by de- limited, its taking property a use, cree dedicated to a process. without due

Courts have sometimes used one or the other of these stay constitutional barriers to hands states which public utility, would make a business in fact when they it was grounds. one. And used both sometimes have attempt segregate There will be no here to Chief them. Mr. Justice Taft forewarns of constitutional impediments involved in effort en- state to large scope “public by legislation interest” Packing in the case of Co. Court Industrial Wolff supra, saying: Relations, “If, contended as, effect, state, counsel for the callings the common clothed interest legislative necessarily a mere au- declaration, comprehensive legis- regulation thorizes full and within discretion, lative must there revolution in be rela- government general tion of business. This will running public-interest argument ground, into the phrase Bradley to use a of Mr. Justice when character- *28 izing similarly Rights extreme contention. Civil Cases, Sup. Rep. 24, 835, 109 27 L. 3, 843, U.S. 3 Ct. 18. It Ed. impossible will to reconcile such result with free- the by dom of contract and of labor secured the Amend- 14th ment.” Supreme Court of the United States, address- in

ing plaintiff of itself to the contention the in in error

296 Transportation v. Railroad Co. case Producers of 239, 64 L.Ed. 251 40 131, U.S. S.Ct.

Commission, 228, language apt: that is most used pipe con- was if the line is, course, “It true that carry producers particular un- solely to oil for structed strictly private and never devoted was der contracts public, carrying public use, is, for its owner to by any legislative the regulating State could mere fiat public convert it into a order a commission utility carrier; or make its owner a common for taking private property without use would be for consistently just compensation, can do which no State process Fourteenth law clause with due supplied.) (Emphasis Amendment.” Supreme considered Court of the United States private trans the status of a carrier who limited portation contracts commerce under three interstate carry nor to had for the not undertaken to Michigan property any public Public use, devote his 191, 45 v. 266 U.S. S.Ct. Duke, 570, Utilities Commission admonished L.Ed. 36 1105. The Court A.L.R. 445, legislative beyond power that “it is of the State exclusively property business in the fiat to convert used private public utility, to make of a carrier into a taking private public carrier, that would be owner property just compensation, without for can do use process consistently of law due no State Trans Producers clause of Fourteenth Amendment. portation 230; Commission, 228, v. Railroad 251 U.S. Co. On the 522, Co. Industrial U.S. 535. Court, Wolff against that, clear enforced to, facts above referred it is if deprive property plaintiff his the act would him, clause of the Constitution.” violation of that Trucking Commission, Frost Co. v. Railroad In 583, 46 S.Ct. 70 L.Ed. 47 A.L.R. U.S. Supreme Court United States considered a statute Supreme California, state of Court of which provision requir- had construed a the state statute as

297 ing private a certificate carrier obtain a contract doing public necessity business convenience and before obliging highways, dedica- a over the as condition state public property business tion carrier’s of the subjecting transportation, thereby him to all the duties imposed common carriers. act and burdens consistently the due The process with “That, Court declared: private Amendment, Fourteenth a clause of the against a will into com- carrier cannot be converted his legislative command, a mon carrier mere rule brought question open here.” into to doubt and is not v. 75 L.Ed. Cahoon, 582, Smith 283 U.S. 51 S.Ct. 553, constitutionality statute 1264,involved the Florida covering constitutionality challenged carriers. Its process ground repugnant on that it was due equal protection 14th Amendment to clauses Relying upon the Duke the federal constitution. supra, a

Frost that “such scheme the Court said cases, private regulation carrier, such business of a appellant, manifestly beyond power as the State.”

Stephenson 251 53 77 Binford, U.S. S.Ct. L.Ed A.L.R. view that the confirms the state by legislative property exclu- cannot fiat convert used private public sively in into a business of carrier public utility, utility since owner thereof make taking private property that would be the just compensation, of the due without use violation process clause the 14th Amendment. many

There which have are state decisions followed typical Only cases. cases these federal few need cited. supra, Commission,

Allen v. Railroad declares: “ statutory our above ‘Our Constitution and definitions applying only quoted therefore must be construed properties fact been devoted to a such as have impress with a use use, and not as effort to properties For have not been devoted thereto. our Constitution construction of the latter be true

if they operation manifestly in their then statutes, prop- private unjustly they interfere void wherever *30 rights by article 1, of erty private force contractual or Consti- Amendment of the § Fourteenth 10, and of the be alternative If the first United States. tution of the parts given, already of such for reasons selected, then, properties with the contracts are affected these petitioners to use not been devoted have these their prevail.” rights private must contractual quite provision is Allen the constitutional case, In the “every ordaining provision, constitutional our like private corporations, associations individuals of class legislature by subject to be individuals, hereafter declared of control likewise to such utilities, shall be requires regulation.” effect court in that case in The “public given meaning term be to the to the traditional utilities.” Coop.

Dairymen’s Com- Public Ass’n v. Sales Service Hertz 218; 98 A.L.R. mission, 177 Atl. 770, Pa. Siggins, 464; A.2d 359 Pa. Stations v. Drivurself Empire Commis- Public and Inland E. v. Service Rural supra, cases. In. instructive a few other sion, serving only cooperative,' mem- one its last case a true bers, was involved. importance supra, because is of utmost case,

The Allen authority legislature, as in in the constitutional utility. this was It was held that ours, to define authority; would that the definition not a blanche carte traditionally used in order the one have to conform to unconstitutionality. avoid federal supra, equally important, Empire case, Inland serving only cooperative members, its because it was Washington Supreme observed Court and the operation public utility attempt hold to be a protections 14th Amend- of the would run afoul the United States Constitution. ment to paramount Enabling Act is law of this state state provisions fundamental of our and all constitutional event In the consistent it. document must be Enabling yield must conflict the constitution Con- Enabling Constitutional directed the Act Act. The would constitution to form a vention this state United repugnant constitution “not be independ- principles declaration States and the and the Federal Constitution 4. Both the ence.” Section rights recognize life, Independence Declaration of liberty, happiness. “lib- pursuit word This and the contract erty” freedom been to include has construed regu- appropriate property under hold and freedom to necessary. such are lations where Enabling “and fundamental

An Act is a becomes changed, amended, paramount cannot be altered, law. It Congress.” disregarded A state an act of without Enabling “cannot inconsistent with constitution Murphy 336. 181 P.2d State, Act.” 65 Ariz. *31 “liberty” appearing Declaration of the The term in meaning Independence has in the as has same it the Sager, McKinster federal and constitutions. See v. state 72 273. Freedom 671, 854, 163 Ind. N.E. 68 L.R.A. “liberty” used within contract is the term as embraced pages 2d, 704-706, in Jur. sub- documents. Am. these the assertion: stantiates

“Although contract’ does not term ‘freedom of the appear right con- Constitution, in enter into a the the exceptions, liberty falls which some is tract, protection process of due clause of the within the the and Fifth to the Constitution Fourteenth Amendments safeguarded by also con- of the United States. It is the guar- states, of a constitutional and, stitutions pursuit general may anty happiness. be said In it contracting liberty privilege both a and a that the right.” property obvious to me selection of electrical

It seems subject cooperatives being public to the re- utilities, they operate, leaving gas, straints under which tele- cooperatives phone, defini- outside the carrier, and other equal in violation of tion, constitutes a classification protection provision In this of the 14th Amendment. respect opinion Mr. Chief Justice I that the believe Supreme case of Court Arkansas, Harris & Commission Arkansas Ozarks Arkansas Commerce Railway rele- some 295, 235 Ark. has Co., S.W.2d Evansville vance. Attention is also called to the case of Valley Ry. & Ind. Rural Electric Ohio Co. v. Southern Corp., 231 109 N.E.2d 901. Ind. unjustifiably broadened ’53, has been 115-1-3,

C.R.S. majority thereby Colorado-Ute a make utility language. statute’s Co- within the breadth of the operatives only are of kinds: those which serve two members members, their and those which serve their public. See 132 A.L.R. and annotation. and in both, statute is so drafted each covers instance the members or are consumers energy. bring cooperative electrical shall To cooperatives manufacture and sell at for a few wholesale (retailers) purport within the statute an un- statute, warranted extension of the and for al- reasons ready stated, violative of the federal constitution. enigmatic pervades status of Colorado-Ute argument record this case. An additional oral parties ordered in which directed court, were questions propounded by to answer certain the court relating public utility. to its status as a Public Service and Western relied while Colorado- statute, position However, Ute’s was one difficult to assess. problems reconciling latter confessed that it had *32 operation Colorado-Ute’s limited is with that which ordinarily sphere pub- believed to be the of action of a utility. lic n CommissionerHorton stated “that there is a very seri- legis- ous doubt the mind of that the require lative intent was to Ute to obtain certificate plant necessity public construct a and convenience Hayden members.” its at to serve points opening (page 108) Colorado-Ute brief

In its following for answer ’53, 115-1-3, to C.R.S. question: comment and

“Accordingly, perfectly record clear from the energy to electric a wholesaler of that Colorado-Ute is only, served its members in Colorado and the areas clearly Does Exhibit 9 shown on . . these members is . public utility?” such a make it a status cooperatives, case, involved Since such as those impact upon public supplying have an utilities electrical right regulated, energy, proper they be it is that impressed not as but as business utilities, governmental agency bet- interest. What perform than Public ter situated this function Utilities Commission?

I would sustain the Commission basis regulatory statute, its action was under the regulation any part its decision in is with- excess out force and effect.

Mr. Justice Moore: Rehearing.

On Petition for

ADDENDUM petition rehearing filed behalf of on Colorado- separately points contains five Ute numbered misapprehended. counsel asserts this court overlooked or following point them We consider in some detail in the by point reference. argued (a)

Point I. It is that our decision denies authority Colorado-Ute the to serve members and gives right protestants (b) exclusive to do re- so; degree quires higher proof Colorado-Ute to sustain a necessity required convenience than that by requiring inadequacy utilities other it to show utility; nonpublic (c) denies Colorado- *33 public opportunities util- afforded other Ute the same existing members, to construct facilities serve ities compensation just process violation of the and due United States Fifth Amendment clauses of the Constitution. (A) Our decision of are true.

None these assertions deny authority furnish electric does appli- acquired energy members it had when deny however, certificate; does, cation was for a it made expand permission spread its its facilities serv- it to a and encompass point those ice where it would areas to already being adequately certificated other served energy. suppliers does not of Our decision electrical right give protestants privilege and the exclusive protect public rendering it does all service, of such but against public competition by new utilities with- utilities public proof findings adequate convenience out expanded necessity facility requires new the new right The decision no constitutional service. violates is affected with wide Colorado-Ute, because its service public must interest and it conform therefore Public Utilities Law Colorado, State regulated monopoly which established well is an doctrine important part of that law. require higher degree

(B) decision does not proof no Colorado-Ute; however, hold that does, necessity proof proper convenience particularly record, of law shown as a matter unanimous of members of the when conclusion all adequate power Commission was that sources of Utilities already proposed supply new existed to needs of the (at points Our out Colorado-Ute. decision members of thereof) pages con- 10 and the Commission (not existing just sidered sources those available all Reclamation) from the Bureau of and found them be requirement adequate. The of the Public Law Utilities protect supporting increased in- is to (in dollars) in excess 30 million vestment case regard dupli- without to whether that investment would sup- regulated nonregulated cate the facilities of a or a plier. impact upon economic adverse existing supply the same whether source *34 (and agency unregulated by federal therefore state authority) public utility subject regulation by or a page opin- the Commission. We refer back to our of pertinent legal ion in this connection conclusions where are drawn.

(C) deny Our decision not does Colorado-Ute “the opportunities public same afforded to other utilities existing construct facilities to serve The members.” “existing petition members” referred to in for re- hearing proposed are new members for whom it necessary expand would be that Colorado-Ute its serv- large portion ice area to a of the State of Colorado, energy disposal. additional electrical have at its Colorado- right Ute original has not been denied the to serve its members. Its desire to construct new and to facilities very serve new requiring proof members was the issue public of necessity convenience and which it failed to sustain because of the Commission’s conclusion that existing energy adequate. sources of were by-pass proof merely by cannot entering this burden of potential into contracts with new or members customers suffering who are not from lack of electrical existing suppliers. assignment

Point II. In this of error is asserted it that this court misconstrued C.R.S. This, 115-5-1. too, we believe is not true. This section, addition to prohibiting public utility interfering from with utility, provides other such plant system that no new proof can public be constructed without convenience necessity, subject exceptions (none to certain applicable case). were found to be in this fact that the Bureau of Reclamation is not utility again does prov- not absolve Colorado-Ute from ing public necessity, convenience and neither does duplicating re- facilities

it detract the law supported quiring not be should enormous investments unnecessary. they consuming are if initiated it Colorado-Ute who record discloses that was availability respect testimony lack all availability power, it to late for Bureau and it is too be considered contend that this evidence should now necessity. determining public convenience and “misappre- court III. here asserted that the Point It is 115-1-3(2) constitutionality C.R.S. hended” (the co-operatives legislative declaration that infringes process, utilities) in it violates due rights equal protection private and violates contract, pertinent provisions of the law in violation of of the United States. Constitution assignment com- error Colorado-Ute Under pletely position unequivocally be- took proceed- reverses the throughout fore ing, the entire *35 apparently places at this late date reliance justice. dissenting content the views the one public utility. position It takes that it is not a now portion opinion in is Reference made that in fact that the business which we discuss detail the is a with interest Colorado-Ute is affected public utility. legislature properly as a classified rehearing petition allegation for contained in This pleading in the first formal ever filed this case pub- it is a in which is claimed that it regulation utility subject jurisdiction lic position that before the Public Utilities Commission. Its representing body exactly opposite. Moses, was Mr. during following a Colorado-Ute, made statement question colloquy relating as whether forensic utility. appeared in a a It that his client was it asserted document filed the Commission was “* * * may public utility.” a that be Colorado-Ute, No, “MR. BARRY: sir. ques- no further I have HORTON:

“COMMISSIONER tions then. might say ex- record and in I MOSES:

“MR. copied application planation was from this, this application when was filed our last securities question Counsel mind. counsel’s had in counsel some any question more. doesn’t have talking sorry, Moses, I Mr. I am was “MR. BARRY: say? you What did with Mr. Baucom. my I in this

“MR. MOSES: said essence previous copied securi- and that was our error, application when there which was filed at ties time they my question in mind as to whether were was a utility anymore. question my mind There is no in not. up Maybe record, we can clear “MR. BARRY: you it would be better. Would and I think like ‘may your application be’? to delete words amend happy perfectly delete I be “MR. MOSES: would ‘may I consistent, be’ think to make it because words utility. we are Have record ZARLENGO:

“COMMISSIONER petition dealing No. 19156 with securities show that the paragraph by dropping one, amended in the words is ‘or may be.’ you.” Thank

“MR. MOSES: assign- IV and V. It is claimed both Points these — findings ments of error that this court made of fact paragraph alleging unconstitutional, four this to paragraph asserting that court violated the five requires reviewing statute which affirmance court finding support aof which has sufficient the evidence. *36 finding alleged by The fact been made to have power existing adequate. court is that sources were Clearly, finding by this was fact this court. not finding by That Commission abund- was and is made opinion antly supported by The the evidence. of this Commis- court contains references to the decision adequacy found sion where all three 'Commissioners finding existing to made a court sources. Had this position of contrary have been in a then we would judgment having unwarrantedly that for our substituted adversely af- Commission, in which case those complaint. ground for fected would have alleged paragraph Public Utilities that the It is in five sup- existing power expressly found that Commission plies adequate the record references to were not allegation specious. given. The Commission are This existing contrary, sources find; found did not so on the adequate, alternative in fact also, that there were proposed power available to Colorado-Ute’s sources by including certificated new members available The area. to in the utilities authorized serve p. (being portion of the Com- reference to C.R. decision) only not fails to sustain mission’s Colorado- finding actually contention, Ute’s but refers to existing adequate. Other Commission that sources were Public Com- references to the record before the Utilities portions point mission to thereof where inadequate; attempted prove power Bureau rejected by expressly of the Com- all three members merely a references the record Such mission. accepted disputed testimony rehash which was p. by 1682 and references to C.R. the Commission. The existing power p. support 1915 do not the assertion that actually, inadequate; found the Commission sources are pages contrary at’ of this assertion shown and 12 of the court’s decision. petition rehearing Public Utilities for filed petition substantially filed is similar to since no new other issues Colorado-Ute. Therefore, petition, discussion raised Commission’s

were rehearing petition relating the Colorado-Ute petition. equally applicable the Commission’s unnecessary, foregoing perhaps while discussion, clarity presented hope may add that it urged opinion points in the and demonstrate *37 or misappre- petition for were overlooked rehearing hended this court. n is denied. rehearing for petition dissent, his Frantz,

Mr. Justice for reasons stated in grant petition rehearing. would No. 21017.

Millie et Palermo, v. James C. Saccomano, etc. al.

(411 22) P.2d February 14,

Decided 1966. it to notes execute and $22,876,000 not to America in amount exceed mortgages in order to finance the to secure the notes project. opposi- protests Public filed Service and Western requests tion to and the matters were Colorado-Ute’s hearing. applications for Protests those consolidated gen- which Public Western were filed and Service erally alleged public utility subject was a each jurisdiction engaged, among of this Commission things, generation, other transmission and distri- power energy bution of at wholesale electric throughout otherwise various areas of the State portion plant, Colorado; that all of the lines, proposed facilities to be constructed physical duplication cause would and uneconomical plants, systems companies the lines, lawfully pub- had been constructed and dedicated to the companies many years use; lic then, and