Untitled Texas Attorney General Opinion ( 1947 )


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  •                                                                 R-458
    45
    t.WX?ICE     OF
    TEE AIYTORNEY               GENERAL
    Ausq~.      TEXAS
    PRICE   DANIEL
    ArTO*NeYGENERAL                    July 23, 19%
    Eon. Ernest 0. Thompson               Opinion No. V-309
    chalrman
    Railroad Commlssion~of                Re: The necessity of
    Texas                                   approval by the
    Au&in, Texas                              Railroad Commls-
    slon of Texas of
    a dlscontlnuance
    of the supply of
    gas to a munlcl-
    pallty by a gas
    utility, pursuant
    to'contractbe-
    tween the parties.
    And related ques-
    tions.
    Dear Sir:
    You have requested the opinion of this Depart-
    ment In letters establishingthis factual situation:
    "111May, 1928, the Mobeetlb Gas Company
    made a contract with certain lndlvldtilsto
    furnish-gasto-the alty'llmlts of Mkuul,
    Roberts County, Texas; these l~lvlduals
    having a franchise from the City running
    for;a period of~20.years;the Mobeetle Gas
    Company to construct a 4 Inch line and fur-
    nishing gas to the city limits of the City
    of Miami.  This contract was .&lsofor a
    period of 20 years. This contract ~111 ex-
    pire in 1948.
    "The Publio-SeFviceCorporationof Tex-
    as is successor to the M6beetle Gas Com-
    pany, and desires to dlscontln~e furnlsh-
    lng 'gasto the ol$g llmlts of the city of
    Miami at the explratXon of Its coatract for
    the reason, 'amongothers, that itswill re-
    quire the constructionof a new 15 Iidle
    line since the old line Is not In condition
    to coritlnueservice after the expiration
    &ate.
    Hon. Ernest 0. Thompson - Page 2                   v-309
    46
    ". . . Public Service Cbrporatlonhas In
    m,lndthat It will give notlce to the owners
    of the franchise in the City of Miami and to
    the said City In ample time for them to make
    other arrangementsbefore the expirationof
    the contract."
    Your questions are as follows:
    "Pleaseadvise If It Is necessary for
    the Public Service Corporationof Texas to
    apply for permission from the Railroad Com-
    mission to discontinuethe service described
    In the enclosed letters and If it is neces-
    sary for a hearing to be held If such appll-
    cation Is to be required.
    "Also please advise us If notice to the
    customers of the utility are required to be
    given notlce,prlor to discontinuanceof
    aervlce Ln the event applicationto the
    CommlsslonIs not required."
    The Public Service CorporationIs a "gas utll-
    1ty" or 'public utility" as defined In Article 6050,
    V.C.S.) as follows:
    "The term 'gas utility' and 'publicutll-
    ltys'or 'utility,*as used In this subdlvl-
    sion, means and Includes persons, companies
    and private corporations,their lessees,
    trustees,and receivers, owning, managing,
    operating,leasing Or controllingwithin
    this State tinywells, pipe lines, plant;
    property, equipment, facility, franchise,
    license, dr permit for elther,one or more
    of the following kinds of business:
    "1. Producing or obtaining,transport-
    ing, conveying distributingor delivering
    natwal~gas: [a) for public use or service
    for ccmpensatlon; (b) for sale to munici-
    palities or persons or companies, In those
    cases referred to In paragraph 3 hereof,
    engaged in distributing or selling natural
    gas to the public; (c) for sale or delivery
    of natural gas to any person or firm or cor-
    portatlon operating under franchise or a con-
    tract with any municlpalltyor other legal
    Ron..Ernest0. Thompson - Page 3                    v-309   47
    subdlvlslonof thls.State.; or, (a) for sale
    or delivery of natural gas to the public for
    domestic or other use.
    "2. Owning or operating or managing  a
    pipe line for the transportationor car-
    riage of natural gas, whether for public
    hire or not, if any,part of the right of
    way for said line haa been acquired, or may
    hereafterbe acquired by the exercise of
    the right of emInentdomaIn; or If said line
    or any part thereof,.lslaid upon, over-or
    under any public road or highway of this
    State, or street or alley of any munlcl-
    pality, or the right of way of any rall-
    road or other,publicutility; Includingalso
    any natural.gas~utilltyauthorize&by law
    to exercise the right of eminent domain.
    “3e  Producing or purchasing natural gas
    and transportingor causing the same to be
    transportedby pipe .llnesto or near the
    llmlts oftany munlclpallty ln~whlch.saSdgas
    Is received ana dlstFlbuted or sold to the
    public by another public utility or by said
    munlclpallty,In all cases where such busl-
    ness Is In fact that only or practically.ex-
    cluslve agency of supply of natural gas to
    such utility or municipality, is hereby de-
    clared to be virtual monopoly and a business
    and calling affected with a DubllC.interest.
    and the said business and property employed-
    therein within this State shall be subject
    to the provisionsof this law and to the ju-
    risdlctlonand regulation of the Commission
    as a gas utility.
    '%very such gas utllftg Is hereby de-
    clared to be affected with a public interest,
    and subject to the jurisdiction,control and
    regulationof the Commission as provided
    herein."
    "Jurlsdlctlon,control and regulation"of.the
    utility are vested In the Railroad Cominisslon
    by Artl-
    cle 
    6050, supra
    . 'This "j~urlsdlctlon"~and"conttiol"
    may
    not be divestedwlthotitthe.consent of,the Railroad Com-
    mlsslon. For only the Railroad Commlsslonmay terminate
    that "jui3sdlctlon"and ,control;"
    48 Eon. Ernest 0. Thompson      - Page 4                 v-309
    Section 1 OS Article   6053, V.C.S., provides as
    follows:
    'The Commissionafter dtienotice shall
    fix and establishand enforce the adequate
    and reasonableprice of gas and fair and
    reasonablerates of charges and Fegulatlons
    for transporting,producling,  dlstrlbutlng,
    buying, selling,and delivering g a by such
    pipe lines In this State; and sha11 estab-
    llsh fair and equitable rules and regula-
    tions for the full control and SupervIsIon
    of said gas pipe lines and all their hold-
    ings pertainingto the gas business in all
    their relations to the public, as the Com-
    mlsslon may frcm time to time deem proper;
    and establish a fair and equitable dlvislon
    of the proceeds of the sale of gas between
    the companies transportingor protiualngthe
    gas and the companies dlatrlbutlngor sell-
    ing It; and prescribe and enforce rules and
    regulatlonafor the governmentati control
    of such pipe lines in respect to their gas
    elpe lines and produalng, receiving,trans-
    porting,   and dlstrlbutlngfaOllitle8;and
    regulate and apportion the supply of gas
    between towns, cities, and corporations,
    and when the supply of gas controlledby
    any gas pipe line shall be Inadequate,the
    Commlssloashall prescribe fair and rea-
    sonable rules and regulationsrequiring such
    gas-pipe lines to augment their supply of
    gas, when-in-thejudgment cjfthe Commlsslon
    it la practicableto do so; and It shall
    exercise its power, whether upon Its own
    motion or upon petition by any person, cor-
    poration,munlclpkilcorporation,county, or
    Commlsslonersprecinct showing a substantial
    Interest.  In the subject,~ortiponpetition of
    the Attorney~G~neral;~or6f any County or
    District Attbrneg in any county wherein such
    business or any part thereof may be carried
    on."
    By virtue of Article-6053, 8.iipra,
    the Commls-
    sion Is empoweredwith'"full oontrol and~supervlslonof
    said gas pipe lines and alltheir holdings pertaining
    to the gas business In all their relations-m
    to the &-
    lie." It Is ft@her%szered      ~1-5       overnmentand
    Hon. Ernest 0. Thompson - Page 5                 v-309      *9
    control of such pipe lines In respect to theif gas pipe
    lines and producing,receiving,transportingand dls-
    trlbutlng facilities"and.empowered to "re&.ate and ap-
    po;il$n the supply of gas controlledbynany gas pipe
    . It may exercise Its power upon Its own motion
    or upon petition."
    It would be an empty "jurisdiction"and an emp-
    ty "full control" if the Commissioncould not continue
    a service by a utility. Otherwise the utlllty could
    abandon at will and bargain on that basis. It Is stated
    In State ex reL Public Service Commlsslonv. Mlssourl
    Southern R. Co. (Sup. Ct. MO, lglg), 
    214 S.W. 381
    .: (pp.
    384-385 I
    11  Can appellant abandon this serv-
    ice witio&, applying to the commissionfor
    leave to do so? If so, any carrier can aban-
    don any service without such leave, and,
    doubtless,change fares and take oft equlp-
    ment, whenever It comes to the conclusion
    that the facts jtistlfysuch action.. If this
    course be lawful, the ccaumlsslonwill became
    little more than a figureheadso far as car-
    riers are concerned,and Its powers can be
    Ignored or Invoked as the carrier may desire.
    In this case the carrier was operating In
    submissionto'the commissionand under rates
    on file. A rate was changed., Instead of
    applying to the commlsslonfor an Increase
    elsewhere,or for leave to abandon the serv-
    ice, the carrier said, In effect, that It
    would not submit to the change, but would
    take up the track. It may be It is entitled
    to an order permitting It to do so. It
    should have applied to the connnlsslonfor
    the leave. Unless the power of the commls-
    slon to pass on this question Is conceded,
    then~lt is apparent the exercise of 801118of
    Its express powers is conditionedupon the
    consent of the carHer. The express power
    of the commission over facllltles,equlpent,
    and honstructlon,and changes therein,and
    over the operation of trains (sections49,
    41, ~avs lg13), pp. 588, sgo), is of.no avail,
    if appellant'scontention $8 sound. As .was
    said by the Kansas SuprenieCourt:
    "'If these utilitg~corporatlons~mag aban-
    don this particular service without the'con-
    sent of the commlssfon,may they not take
    50   Hon. Ernest 0. Thompson - Page 6                  v-309
    off their pass6nger trains, take up and aban-
    don unprofitablebranch lines, change the
    fares and rates of transportation for pas-
    sengers and freight, or raise the charge for
    telegraphmessages without the consentof
    the'commlsslon? These questionsanswer them-
    selves. To yield approval to the contention
    of defendants Is to concede that the state's
    program for the regulationand controlof
    public service corporations1s Ineffective;
    that the Public UtllltlesAct has been enact-
    ed In vain.' State ex rel. v. PostalTel.
    
    co., supra
    ."
    It Is further stated in State v. Kansas Postal-
    Telearauh-CableCo. (Sup. Ct. Kans. 1915),15CP. 544:
    '(P.5471
    II
    . . . In view of all these, can there
    be any doubt of the duty of the defendant,
    before dismantlingIts stationat Syracuse
    and abandoning Its business thereat,t@ se-
    cure the approval of the ConmIssionfor such
    an Important change in Its mode of service?
    How Is the Public lJtllltlesCommissionto
    discharge Its importantduties if the pnb-
    llc service companiesmay quit businesshere,
    there, or anywhere In the state vlthout 811
    opportunityfor the %omisslon to detezi:ne
    the propriety of such a course?
    "It Is clear that, If the defendantmy
    forego Its business In Syracusevithotithe
    sanction of the Commlsslon,it can close its
    office in Topeka, Wichita, or Kensas CLtr,
    without the consentof the Comlsslon. Jf
    this public utility,'& telegraphcompsv, can
    close one of its offices and qult bus'3ess
    without the-consentof the Commlsslon,6~
    dther'ptibllc utility, like the Santa P? Zall-
    w&y, So* exempl6; could close Its depct at
    DMg6 City, Htitchlnson,  or Emporiavitt?zt
    the consent of the Cominli~sloh. Where r--nld
    this end? If these utility corporatlozsgay
    abandon this partlculsrservicewlthorr.   :he
    consent of the Commlssion;may they net -zke
    off their passenger trains,take up ati sban-
    don unprofitablebranch lines, change t%
    fares and rates of transportation  for 1Ji'-
    sengers  and freight, or raise the c-e    for
    Ron. Ernest 0. Thompson - Page 7                 v-3.09
    51
    telegraphmessages without the consent of the
    CCmmlSslon?'These questldns answer themselves.
    To yield approval to the contentionof the de-
    fendant Is to concede th8t the state's program
    for the regulationand control of public serv-
    ice corporationsis Ineffective;that the pub-
    lic utllltles act has been enacted In vain."
    Further reason dictates that this jurisdiction
    may not be terminatedwithout the consent of the Rall-
    road Commission. For, If the conversebe true, a util-
    ity, against the will of the State, could abandon Its
    pipe line, tear up the line and sell it before replace-
    ment could be made. The possible effects of such a
    claimed power could be utter disaster to the great ln-
    terests of the community. Destructionof private prop-
    erty, in which the entire community Is Interested,could
    result. The life of the citizen as well as the property
    could be jeopardized.
    It Is well establishedthat "as a general rule,
    the proprietor of a public utility or service Is bound
    to continue the business until such time as he shall
    have been granted permission to discontinueIt." 34
    Tex. Jur., "Public Utllltles and Services,"Section 15,
    p. 717; 43 Am. Jur., "Public Utllltlesand Services,"
    Section 78, p. 621; 5 Corpus Jurls, "PublicUtllitles,"
    Section 17, p. 8. See 5 P. U. R. Digest, "Service,"
    Section 215, pp. 4611-4614.
    Moreover, this has been the practice and con-
    struction of the Railroad Coxnlssionover a period of
    years. During this period of years, utllltles have made
    applicationto the Railroad Commissionfor permission to
    discontinuetheir service. The constructionand lnter-
    pretation of a statute by the Departmentcharged with
    its administrationIs entitled to great weight and will
    be adhered to unless clearly erroneous or unsound. 39
    Tex. Jur., "Statutes,"Section 126, pp. 235-237.
    In answer to your first question, therefore,
    the Public Service Corporationmust have the consent of
    the Railroad Commission to discontinuethe furnishingof
    gas to the dfstPlbutor for the City of Miami.
    Section 1 of Article 
    6053, supra
    , provides, in
    part, as follows:
    "The Commissionafter due notice shall
    fix and establish . . .'I
    sf2 Hon. Ernest 0. Thompson - Page 8                   v-309     '
    Section 14 of Article 6053, v.c.s., provides as
    follows:
    "Rotice of 8ny hearing,and of the time
    and place thereof, shall be given by regls-
    tered'mallnot less than ten (10) claysex-
    clusive of the day of mailing before such
    hearing, addressed to all parties whom the
    Comml~slonmay deem to be interestedIn the
    subject matter of such hearing. Any llcen-
    see against whom a complainthas been filed
    shall be notified of the hearing on such com-
    plaint as herein provided,and shall have the
    right to appear at such hearing, file answer,
    Introduce evidence, and be heard both in p,er-
    son and by counsel."
    In answer to your second question, It Is our
    opinion that the statutes contemplatea hearing by the
    Railroad Commlsslonupon applicationfor discontinuance
    of service, because the Commissionmust enter an order
    upon such applicationunder Article 
    6053, supra
    , which
    must be after "due notice." Section 
    14, supra
    , provides
    that "notice of any hearing" shall be qlven to "lnter-
    ested" parties, not less than 10 days before such hear-
    ing."
    In view of this opinion, your third question
    does not require an ansver.
    SWMARY
    1. It Is necessary for the Public Serv-
    ice Corporation,a "gas utility" as defined
    bg~our statutes (Article6050, V.C.S.), to
    have the consent of the Railroad Conrmlsslon
    to discontinuethe furnishingof gas to the
    distributor for the City of Miami.  State ex
    rel. Public Servfce Commissionv. Mlssourl
    Southern R. Co; (Sup. Ct. MO. lglg), 214
    3~.W: 381, 384; State v. Kansas Postal-Tele-
    graph-cable Co. (Sup.
    p. 544, 547.
    2. A hearing must be held by the Com-
    mlsslon on an 8ppllcatlon of a "gas utility"
    for requested permission to discontinue
    53
    Hon. Ernest 0. Thompson - Page 9                    v-309
    service to a municipality. Article 6053,
    V.C.S.
    Yours very truly
    A!l3!ORNEYGElW3ALOFTEXAS
    BY
    EMH:jt
    

Document Info

Docket Number: V-309

Judges: Price Daniel

Filed Date: 7/2/1947

Precedential Status: Precedential

Modified Date: 2/18/2017