Robert Burns v. Arizona Public Service Co

IN THE
SUPREME COURT OF THE STATE OF ARIZONA
ROBERT BURNS,
Plaintiff/Appellant,
v.
ARIZONA PUBLIC SERVICE COMPANY, ET AL.,
Defendants/Appellees.
No. CV-21-0080-PR
Filed September 27, 2022
Appeal from the Superior Court in Maricopa County
The Honorable Daniel J. Kiley, Judge
No. CV2017-001831
VACATED
Opinion of the Court of Appeals, Division One
250 Ariz. 607 (App. 2021)
REVERSED AND REMANDED
COUNSEL:
William A. Richards (argued), Richards & Moskowitz PLC, Phoenix,
Attorneys for Robert Burns
Mary R. O’Grady, Joseph N. Roth, Matthew J. Stanford, Osborn Maledon,
P.A., Phoenix; Matthew E. Price (argued), Jenner & Block LLP, Washington,
DC, Attorneys for Arizona Public Service Company, et al.
Edward F. Novak, Jonathan G. Brinson (argued), Polsinelli PC, Phoenix,
Attorneys for Arizona Corporation Commission, et al.
Sarah L. Barnes, Broening Oberg Woods & Wilson, P.C., Phoenix, Attorneys
for (Former) Commissioner Boyd Dunn
BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
Opinion of the Court
_______________
JUSTICE BOLICK authored the Opinion of the Court, in which JUSTICES
BEENE, MONTGOMERY, and KING joined. VICE CHIEF JUSTICE
TIMMER dissented. *
_______________
JUSTICE BOLICK, Opinion of the Court:
¶1 In this case we hold that the Arizona Corporation
Commission (“Commission”) acting by a majority of its commissioners
may not prevent an individual commissioner from exercising investigatory
powers pursuant to article 15, section 4 of the Arizona Constitution; and
that a commissioner aggrieved by such action may seek judicial recourse by
way of declaratory judgment pursuant to A.R.S. §§ 12-1831 to -1846.
BACKGROUND
¶2 During the 2014 primary and general elections for the
Commission, allegations were made that two elected commissioners
received anonymous campaign contributions from Pinnacle West, using
funds derived from Arizona Public Service Co. (“APS”). Pinnacle West is
the holding company of APS, a public service corporation (“PSC”). In
November 2015, Robert Burns, then a member of the Commission,
requested spending reports from APS regarding the 2014 election cycle.
APS did not comply. Subsequently, Burns requested and received an
opinion from the Attorney General, who concluded that A.R.S. § 40-241
confers power on individual commissioners to “gather information
regarding a PSC’s political and charitable contributions, and lobbying
expenditures, by inspecting the books and records of a PSC, and examining
under oath PSC personnel.” Op. Ariz. Att’y Gen. I16-005 at 9 (2016).
¶3 In August 2016, the four other commissioners voted to refuse
to fund Burns’ investigation into APS’s records for its pending rate-making
case before the Commission (the “Rate Case”). In turn, later that month
*
Chief Justice Robert Brutinel and Justice John R. Lopez IV have recused
themselves from this case.
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Opinion of the Court
Burns issued two subpoenas to APS in his capacity as a single
commissioner. Both subpoenas sought information regarding donations
made to independent expenditure groups to support Commission
candidates in the 2014 election. In February 2017, Burns again issued two
similar subpoenas to APS during a new Commission proceeding (the
“Rule-Making Case”). APS did not fully comply with either the 2016 or
2017 subpoenas.
¶4 Shortly after, in March 2017, Burns sued APS for declaratory
relief, arguing that individual commissioners have authority to demand
compliance with subpoenas without the approval from other
commissioners. APS moved to dismiss, arguing that Burns failed to
exhaust his administrative remedies as to both sets of subpoenas. Ruling in
favor of APS, the superior court stayed both proceedings so that Burns
could first exhaust his administrative remedies.
¶5 During the Rate Case, Burns attempted to call six witnesses,
including APS and Pinnacle West’s president and board chairman. The
administrative law judge (“ALJ”) declined to call the witnesses without
approval from the other Commission members. In response, Burns sought
emergency relief from the ALJ. He also moved to disqualify two
commissioners, alleging they had received “dark money” from APS and
Pinnacle West during the 2014 election. The ALJ did not rule on either
motion.
¶6 Burns next sought compliance with his issued subpoenas. On
June 20, 2017, the Commission held a public meeting to consider his
motions. An interlocutory order was issued on June 27, 2017 on behalf of
the Commission and approved by the four other commissioners. The order
denied Burns’ motions. In the interlocutory order, the other commissioners
found that Burns’ motions sought information that was irrelevant to the
Rate Case; the subpoenas were overly broad, burdensome, and would not
produce admissible evidence; and Burns’ requests for witnesses were
irrelevant and would not lead to admissible evidence.
¶7 In response, Burns sought leave to amend his superior court
complaint to challenge the interlocutory order and add the Commission
and the four other individual commissioners as defendants. The superior
court granted Burns’ motion to amend, and on August 4, 2017, he timely
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Opinion of the Court
filed his First Amended Complaint. Burns also filed a special action with
this Court on August 20, 2017. The special action challenged the denial of
Burns’ motion to suspend the Rate Case to investigate grounds for
disqualifying the other commissioners. This Court declined jurisdiction.
¶8 Shortly after, the other commissioners reached a settlement
agreement that the ALJ approved over Burns’ opposition. Following the
settlement, both APS and the Commission moved to dismiss Burns’ First
Amended Complaint. The superior court held that (i) the case was not
moot; (ii) the request for declaratory relief was appropriate to determine the
commission’s investigatory powers; (iii) the subpoenas did not improperly
interfere with the legislature’s or Commission’s powers; and (iv) Burns had
the authority to issue the subpoenas as an individual commissioner.
However, the court also ruled that although individual commissioners may
issue subpoenas, the power to enforce subpoenas rests with the
Commission as a body. For that reason, the court dismissed Burns’ First
Amended Complaint.
¶9 Following that decision, Burns sought leave to amend his
complaint a second time to request specific declaratory relief on the
superior court’s rulings in his favor, and to argue his due process right to
investigate and present facts about APS’s financial support to the
commissioners’ campaigns. The superior court granted leave to amend in
part, denying Burns’ request for declaratory relief as to its prior rulings.
¶10 After Burns’ Second Amended Complaint was filed, APS and
the Commission moved to dismiss it. On January 17, 2019, the superior
court dismissed the case and entered judgment against Burns. The court
held that Burns lacked standing to assert his due process argument.
Additionally, the court held that Burns was not legally entitled to initiate
and maintain an investigation to disqualify other commissioners.
¶11 Burns timely appealed to the court of appeals challenging the
dismissal of his two amended complaints. The court of appeals affirmed
the trial court’s ruling, holding that individual commissioners lack
authority to enforce investigatory subpoenas in rate-making cases because
that authority rests solely with the Commission and a majority of its
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Opinion of the Court
commissioners. Burns v. Ariz. Pub. Serv. Co., 250 Ariz. 607, 614–15 ¶ 34
(App. 2021).
¶12 We granted review on two issues. First, whether the Arizona
Constitution allows a majority of commissioners to prevent any single
commissioner from exercising the investigatory powers expressly granted
to each in article 15, section 4. Second, whether the Arizona Uniform
Declaratory Judgment Act (“UDJA”) grants a commissioner standing to
seek a declaration of his and his colleagues’ rights. These are significant
issues of statewide concern. We have jurisdiction over the appeal pursuant
to article 6, section 5 of the Arizona Constitution.
DISCUSSION
¶13 We note at the outset that the questions on which we granted
review are narrow. Moreover, we focus only on the subpoenas issued by
Burns in the Rate Case that the other commissioners effectively quashed.
Therefore, we will neither resolve all the issues addressed in the courts
below nor the appropriate scope of Commission rules and proceedings
going forward. But we agree with the court of appeals that the questions
as presented are important and that we should resolve them even though
Burns and his colleagues are no longer commissioners. Burns, 250 Ariz.
at 611 ¶ 14. Because they present purely issues of law, we review them de
novo. Johnson Utils. v. Ariz. Corp. Comm’n, 249 Ariz. 215, 219 ¶ 11 (2020).
¶14 The Commission is established by article 15 of the Arizona
Constitution. Its creation arose from the framers’ determination “to protect
the public from corporate abuses and overreaching.” Johnson Utils., 249
Ariz. at 219 ¶ 13. The Commission has plenary authority to set rates for
PSCs and permissive authority to regulate PSCs for the health, safety,
comfort, and convenience of their customers, employees, and the public.
Ariz. Const. art. 15, § 3; see also Johnson Utils., 249 Ariz. at 220–21 ¶¶ 19, 21.
As relevant here, the Commission also has authority to investigate records
and affairs of publicly traded corporations and PSCs. Ariz. Const. art. 15,
§ 4. This Court has held that the Commission has “broad powers to conduct
public or private investigations to determine whether any person or
corporation has violated or is about to violate” Arizona laws and may
“investigate merely on suspicion that the law is being violated, or even just
because it wants assurance that it is not.” Polaris Int’l Metals Corp. v. Ariz.
Corp. Comm’n, 133 Ariz. 500, 506 (1982) (quoting U.S. v. Morton Salt Co., 338
5
BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
Opinion of the Court
U.S. 632, 642–43 (1950)). Moreover, the legislature may add to the
Commission’s powers and responsibilities. See Ariz. Const. art. 15, § 6
(“The law-making power may enlarge the powers and extend the duties of
the corporation commission, and may prescribe rules and regulations to
govern proceedings instituted by and before it; but, until such rules and
regulations are provided by law, the commission may make rules and
regulations to govern such proceedings.”).
¶15 Even within its plenary ratemaking authority; however, the
Commission remains “subject to constitutional constraints and
requirements, both general (such as due process) and those specific to the
entity.” Sun City Home Owners Ass’n v. Ariz. Corp. Comm’n, 252 Ariz. 1, 5
¶ 16 (2021). Those boundaries are subject to judicial review. See Johnson
Utils., 249 Ariz. at 227 ¶ 52 (“Although we certainly recognize the
constitutional authority of the Commission, it is our duty to interpret the
limit and extent of that authority.”).
A. An Individual Commissioner’s Investigatory Authority
¶16 Burns argues that his authority as an individual
commissioner emanates from article 15, section 4, which states as follows:
The corporation commission, and the several members
thereof, shall have power to inspect and investigate the
property, books, papers, business, methods, and affairs of any
corporation whose stock shall be offered for sale to the public
and of any public service corporation doing business within
the state, and for the purpose of the commission, and of the
several members thereof, shall have the power of a court of
general jurisdiction to enforce the attendance of witnesses
and the production of evidence by subpoena, attachment, and
punishment, which said power shall extend throughout the
state. Said commission shall have power to take testimony
under commission or deposition either within or without the
state.
Burns asserts that this constitutional text specifically authorizes not only the
Commission as a whole, but each of its “several commissioners,” to inspect
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BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
Opinion of the Court
and investigate PSC records and affairs and to compel the testimony of
witnesses and production of evidence by subpoena and otherwise.
¶17 Burns further identifies as a source of authority A.R.S.
§ 40-241(A), which provides as follows:
The commission, each commissioner and person employed
by the commission may, at any time, inspect the accounts,
books, papers and documents of any public service
corporation, and any of such persons who are authorized to
administer oaths may examine under oath any officer, agent
or employee of such corporation in relation to the business
and affairs of the corporation.
Burns also notes that Arizona Administrative Code R14-3-109(P) provides
that “[t]he Commission, a Commissioner, or any party to any proceeding
before it may cause the depositions of witnesses to be taken in the manner
prescribed by law and of the civil procedure for the Superior Court of the
state of Arizona.”
¶18 APS and the Commission counter with several arguments.
First, they note that under article 15, section 3 of the Arizona Constitution,
the Commission’s power over ratemaking is plenary, see Johnson Utils., 249
Ariz. at 221 ¶ 21, and thus, they contend the Commission controls the
proceedings that lead to ratemaking. They argue that section 4, which
Burns cites as the constitutional source of his authority to act unilaterally,
only provides “that the commissioners, when acting on behalf of the
commission and not independently of the commission, have authority.”
They also assert that under section 6, the Commission has the power to
establish rules and procedures unless and until the legislature does so. And
section 19 invests the Commission with the authority to enforce its rules,
regulations, and orders, subject to the limitations prescribed in section 16.
¶19 Beyond these constitutional provisions, the Commission and
APS cite A.R.S. § 40-243(A), which provides that “[a]ll hearings and
investigations before the commission or a commissioner shall be governed
by this article, and by rules of practice and procedure adopted by the
commission.” The Commission argues that when it quashed Burns’
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BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
Opinion of the Court
subpoena, it was acting pursuant to R14-3-109(O), which empowers it to
“[q]uash the subpoena if it is unreasonable or oppressive.”
¶20 Although not addressing the specific subpoenas at issue here,
the Attorney General, in his opinion responding to Burns’ inquiry,
concluded that an individual commissioner is authorized to unilaterally
issue subpoenas to PSCs, pursuant to both article 15, section 4 of the
Arizona Constitution and A.R.S. § 40-241(A). Op. Ariz. Att’y Gen. I16-005
at 5. In particular, the Attorney General observed that “[t]he plain language
of Section 40-241(A) specifically refers to not just ‘[t]he commission’ but also
‘each commissioner.’” Id. at 8 (second alteration in original).
¶21 The court of appeals, by contrast, agreed with APS and the
Commission. It noted that under article 15, section 6 of the Arizona
Constitution, the Commission is authorized to make rules and regulations
to govern proceedings before it. Burns, 250 Ariz. at 612 ¶ 20. The
Commission quashed Burns’ subpoena under one such rule, R14-3-109(O),
and the court held that its “review of a Commission determination not to
enforce a subpoena is deferential.” Id. ¶ 23.
¶22 With respect to the narrow issue presented here of a single
commissioner’s authority to inspect the books of a PSC and depose its
officials, we agree with the Attorney General and Burns: the principal
source of that authority is article 15, section 4 of the Arizona Constitution.
The court of appeals quoted its language, Id. ¶ 19, but then failed to apply
it, instead subordinating the authority provided there to the Commission’s
general rulemaking authority. That was in error.
¶23 Our role in constitutional interpretation is to construe the text,
when possible, in accord with its plain meaning. Morrissey v. Garner, 248
Ariz. 408, 410 ¶ 8 (2020). We seek to give effect to every word, so as to
render superfluous none of the text. Id. We also read the provision at issue
in its broader context. Id.¶24 Article 15, section 4 confers the power to inspect and
investigate upon “[t]he corporation commission, and the several members
thereof.” Ariz. Const. art. 15, § 4. It further provides that “for the purpose
of the commission, and of the several members thereof, [they] shall have
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BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
Opinion of the Court
the power of a court of general jurisdiction to enforce the attendance of
witnesses and the production of evidence by subpoena” or otherwise. Id.
¶25 “Several” in this context means separate, respective, or
individual. Several, Merriam-Webster, https://www.merriam-
webster.com/dictionary/several (last visited Sept. 21, 2022) 1; cf. U.S. Const.
art. 1, § 2, cl. 1 (“The House of Representatives shall be composed of
Members chosen . . . by the People of the several States.”). Were it to mean
the collective body, no reason would exist to conjoin the Commission “and
the several members thereof.” Ariz. Const. art. 15, § 4. Moreover, the
drafters’ use of a comma following “[t]he corporation commission”
indicates that what follows is a separate category. See, e.g., U.S. v. Ron Pair
Enters., 489 U.S. 235, 241 (1989) (stating that where two nouns are separated
by a comma as well as “and,” each “stands independent” of the other); State
v. Feldstein, 134 Ariz. 129, 130 (App. 1982).
¶26 The Commission argues that the introduction to the second
part of the provision—“for the purpose of the commission”—restricts the
investigatory powers to the purpose established by the commission. Ariz.
Const. art. 15, § 4. But again, this preface is conjoined with “and of the
several members thereof.” Reading section 4 in its totality, giving effect to
every word, the conclusion is inescapable: it provides to the Commission,
and to its individual members, the authority to investigate and inspect, and
the power of a court of general jurisdiction to compel the attendance of
witnesses and the production of documents through specified means such
as a subpoena.
¶27 This interpretation is consistent with the Commission’s
structure. Our constitution’s framers could have provided for a single
commissioner. Instead, it comprised the Commission of three members,
later enlarged to five, three of whom are elected at one general election and
1
A 1912 dictionary likewise defines “several” to include distinct, separate,
different, and various; but also “consisting of a number more than two, but
not many.” Several, New Websterian Dictionary Illustrated 745 (1912).
Given that the Commission initially was comprised of only three members,
“a number more than two” would comprise the entire Commission,
rendering meaningless “the several members thereof.” Ariz. Const. art. 15,
§ 4. We therefore conclude that the meaning of “several” in this context
means the individual commissioners.
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Opinion of the Court
two the next. Ariz. Const. art. 15, § 1(B). That structure facilitates a
Commission that acts as a collective body in most instances, but with
individual members authorized to act unilaterally in specified
circumstances.
¶28 Moreover, other provisions of article 15 (§§ 3, 5, 6, 14, 19)
confer authority exclusively upon the “commission,” whereas “and the
several members thereof” is confined to section 4. Where the drafters used
different language in different provisions, we imply that a different
meaning is intended. Rochlin v. State, 112 Ariz. 171, 176 (1975) (“If the
authors of the constitution had intended the sections to mean the same
thing they could have used the same or similar language. The fact that they
did not, requires the conclusion that the sections were meant to be
different.”). The framers plainly meant to authorize not only the
Commission but also individual commissioners, for their purposes, to issue
investigatory subpoenas.
¶29 Reading article 15 in its entirety dictates that any other
interpretation would render section 4 superfluous. It would expressly vest
powers in individual commissioners but then subordinate that right to the
unreviewable determinations of other commissioners. Burns’ allegations
demonstrate how untenable such a construction is, whereby a
commissioner’s investigation into possible improprieties concerning his
colleagues can be squelched by the very subjects of the investigation.
¶30 The court of appeals emphasizes the regulatory authority
conferred upon the Commission by article 15, section 6 of the Arizona
Constitution to “make rules and regulations” to govern proceedings. Burns,
250 Ariz. at 612 ¶ 20. We do not read separate constitutional provisions to
determine which prevails over the other; rather, we read them to harmonize
the provisions and give effect to each. State v. Osborne, 14 Ariz. 185, 204
(1912) (observing that “each and every clause in a written [c]onstitution has
been inserted for some useful purpose” and “whenever it is possible to do
so, each provision must be construed so that it shall harmonize with all
others without distorting the meaning of any of such provisions”). Giving
all provisions due meaning, the Commission possesses authority to the
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BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
Opinion of the Court
extent provided to create rules and procedures but not to cancel the
individual commissioners’ express rights.
¶31 Nor does the fact that the subpoenas were issued in the
context of a ratemaking proceeding under article 15, section 3 alter the
analysis. Although that section invests the Commission with plenary
authority to regulate rates, it neither furnishes additional authority to the
Commission to establish procedural rules (which is conferred by section 6)
nor cancels an individual commissioner’s investigatory powers under
section 4. Indeed, as the circumstances here illustrate, it may be especially
pertinent for a commissioner to deploy such investigatory powers to
determine possible conflicts of interest in a rate case. And as we
emphasized in Johnson Utilities, even the Commission’s plenary ratemaking
authority is constrained by the constitution. Johnson Utilities, 249 Ariz.
at 221 ¶ 23. Again, we seek to harmonize the powers and constraints set
forth in article 15.
¶32 Moreover, the court of appeals omits a crucial part of the
constitutional passage conferring regulatory authority. It cites the language
from section 6 that “the commission may make rules and regulations to
govern [proceedings instituted by and before it],” Burns, 250 Ariz. at 612
¶ 20 (alteration in original), but fails to acknowledge the temporal
limitation immediately preceding it: “until such rules and regulations are
provided by law.” Ariz. Const. art. 15, § 6. The legislature definitively
resolved this very question in A.R.S. § 40-241(A), which authorizes the
Commission and “each commissioner” to inspect a PSC’s books and papers
and to examine PSC officials under oath.
¶33 Though Burns argued he had authority under § 40-241(A), the
court of appeals nowhere addressed that statute, instead proceeding
directly to the agency’s rules, specifically R14-3-109(O). Burns, 250 Ariz.
at 612 ¶ 21. It is unclear whether R14-3-109 as a whole, or subsection (O) in
particular, applies in this context. See, e.g., R14-3-101(A) (providing that the
rules shall not “apply to any investigation by the Commission, any of its
divisions or its staff”). Regardless, the Commission cannot by
administrative fiat erase an individual commissioner’s constitutional
authority. See, e.g., Polaris, 133 Ariz. at 506; Saguaro Healing LLC v. State, 249
Ariz. 362, 365 ¶ 19 (2020) (noting “[t]he scope of an agency’s power is
measured by statute and may not be expanded by agency fiat.” (alteration
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BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
Opinion of the Court
in original) (quoting Cochise Cnty. v. Ariz. Health Care Cost Containment Sys.,
170 Ariz. 443, 445 (App. 1991))).
¶34 That does not mean that the individual commissioner’s
subpoena powers are without constraint. To the contrary, they are bound
by the Commission’s own limited constitutional authority, as well as the
overarching requirements of due process. Polaris, 133 Ariz. at 507. The
target of a subpoena may seek judicial recourse through a declaratory
judgment action and Arizona Rule of Civil Procedure 45, or other legally
authorized recourse. We also do not imply that the fruits of an individual
commissioner’s investigation are necessarily admissible in a particular
Commission proceeding.
¶35 Likewise, the Commission may adopt and enforce subpoena
procedures. See A.R.S. § 40-243(A) (“All . . . investigations before the
commission or a commissioner shall be governed by this article, and by
rules of practice and procedure adopted by the commission.”). Such
authority clearly encompasses rate cases, which are quasi-judicial
proceedings where more formal procedures may be appropriate. But the
Commission has not adopted procedures governing subpoenas issued by
individual commissioners. It may adopt such procedures so long as they
do not abrogate an individual commissioner’s constitutional and statutory
authority. As the following section suggests, an aggrieved commissioner
should seek recourse through a declaratory action in superior court.
B. Availability of Relief Under the Uniform Declaratory
Judgment Act
¶36 Section 12-1832 provides in relevant part that “[a]ny
person . . . whose rights . . . are affected by a statute . . . may have
determined any question of construction or validity arising under
the . . . statute . . . and obtain a declaration of rights, status or other legal
relations thereunder.” The legislature further provided that “[t]his article
is declared to be remedial; its purpose is to settle and to afford relief from
uncertainty and insecurity with respect to rights, status and other legal
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Opinion of the Court
relations; and is to be liberally construed and administered.” A.R.S. § 12-
1842.
¶37 As we held above, Burns has a statutory right to investigate
PSCs. Moreover, we have applied the UDJA to administrative orders.
Polaris, 133 Ariz. at 504; see also City of Surprise v. Ariz. Corp. Comm’n, 246
Ariz. 206, 210 ¶ 9 (2019) (holding that indirect assertion of regulatory
authority provides “sufficient injury to provide standing”).
¶38 No party seriously disputes Burns’ standing to pursue relief
under the UDJA. Rather, the Commission and APS argue that the courts
below were correct in denying declaratory relief. On the narrow
substantive issue on which we granted review, we disagree and remand to
the trial court to determine if any further proceedings are warranted given
that Burns no longer serves on the Commission.
C. Attorney Fees
¶39 Per Burns’ motion, we award his attorney fees pursuant to
A.R.S § 12-348.01, and costs under A.R.S. § 12-1840.
CONCLUSION
¶40 We vacate the opinion of the court of appeals, reverse the
superior court’s denial of summary judgment on the issues before us, and
remand the case to that court for any further proceedings consistent with
this ruling.
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BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
VICE CHIEF JUSTICE TIMMER, Dissenting
TIMMER, VCJ., Dissenting
¶41 I agree with my colleagues that Burns has standing under the
Uniform Declaratory Judgments Act, A.R.S. §§ 12-1831 to -1846, to file this
lawsuit. I also agree that the Arizona Corporation Commission, by majority
vote, cannot prevent an individual commissioner from exercising his
authority under article 15, section 4 of the Arizona Constitution, to inspect
and investigate the affairs of a publicly held corporation or a public service
corporation (“PSC”). But I disagree with my colleagues that the
Commission prevented Burns from exercising his right to inspect and
investigate here by denying several motions Burns filed in APS’s rate case.
¶42 As a commissioner, Burns had constitutional authority to
inspect and investigate “the property, books, papers, business, methods,
and affairs” of APS and its holding company, Pinnacle West Capital
Corporation. See Ariz. Const. art. 15, § 4; see also A.R.S. § 40-241(A)
(authorizing individual commissioners “at any time [to] inspect the
accounts, books, papers and documents of any [PSC]”). He exercised this
authority outside the rate case. For example, in 2015 Burns created a
“generic docket” to explore PSC’s campaign contribution practices. In that
docket, Burns demanded that APS produce a “full report[] of any campaign
contributions and indirect contributions to third-party organizations”
made during the 2014 election cycle, and later broadened that request to
include “funds expended on all political contributions, lobbying, and
charitable contributions, i.e., all donations made—either directly or
indirectly—by APS or under APS’s brand name for any purpose.” APS
refused to comply with Burns’ demands, but Burns did not enforce the
request by issuing a subpoena and apparently dropped the matter in that
docket. See Ariz. Const. art. 15, § 4 (empowering an individual
commissioner to “enforce the attendance of witnesses and the production
of evidence by subpoena, attachment, and punishment”).
¶43 APS’s rate case began in 2016 when it filed an application to
set new utility rates. The Commission then issued orders setting a
procedural schedule, granting several interventions, and consolidating the
rate case with two APS audits. Most of the approximately forty parties in
the case reached a settlement agreement that increased APS’s base rate, and
after reviewing documentation and conducting a seven-day evidentiary
hearing, an administrative law judge (“ALJ”) recommended that the
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BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
VICE CHIEF JUSTICE TIMMER, Dissenting
Commission approve the new rate as just and reasonable. In 2017, the full
Commission, with Burns dissenting, adopted the ALJ’s recommendation.
¶44 During the rate case proceedings, Burns renewed his quest to
obtain information about APS and Pinnacle West’s spending. He issued
two subpoenas duces tecum compelling the companies to produce
documents and information identifying political and charitable
contributions and lobbying and marketing/advertising expenditures from
2011 through 2016. APS and Pinnacle West moved to quash the subpoenas,
but the Commission never ruled on the motion. See Ariz. Admin. Code
R14-3-109(O)(1) (empowering the Commission to quash unreasonable or
oppressive subpoenas). Then Burns filed this lawsuit asking the superior
court to declare he was entitled to demand compliance with the subpoenas,
but the court stayed the suit to give Burns an opportunity to exhaust his
administrative remedies by asking the Commission to compel compliance.
¶45 Thereafter, and as pertinent here, Burns filed motions to
(1) compel APS and Pinnacle West’s compliance with the subpoenas;
(2) require the ALJ to call several previously unscheduled witnesses during
the evidentiary hearing and permit Burns’ private attorney to question
those witnesses; and (3) stay the entire rate case until Burns completes his
investigation. The Commission, with Burns dissenting, denied the motions,
ruling the information sought was irrelevant to the rate case, and the
subpoenas were overbroad, unduly burdensome, and sought information
outside the 2015 “test year,” which was the only year relevant in applying
the rate-setting formula. See Residential Util. Consumer Off. v. Ariz. Corp.
Comm’n, 240 Ariz. 108, 110 ¶ 6 (2016) (describing the formula);
R14-2-103(A)(3)(p) (defining “test year”).
¶46 The issue here is whether the Commission’s ruling in matters
properly brought before it in the rate case violated Burns’ constitutional
authority under article 15, section 4 of the Arizona Constitution, to inspect
and investigate. Unlike the majority, I conclude it did not.
¶47 First, even assuming Burns’ subpoenas and requests
constituted an “investigation” under section 4, nothing in that provision
authorized him to compel the other commissioners or the Commission as a
whole to enforce his efforts. See City of Surprise v. Ariz. Corp. Comm’n,
246 Ariz. 206, 212 ¶ 20 (2019) (noting that the Commission, and necessarily
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BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
VICE CHIEF JUSTICE TIMMER, Dissenting
each commissioner by extension, “has no implied powers and its powers”
are “derived from a strict construction of the [c]onstitution and
implementing statutes” (quoting Com. Life Ins. Co. v. Wright, 64 Ariz. 129,
139 (1946))). Thus, although Burns was empowered by section 4 to enforce
his investigative efforts, he could not force the Commission to assist him by
granting his motions. 2 And no matter how tightly the majority squints, the
other commissioners’ refusal to compel APS and Pinnacle West’s
compliance with Burns’ subpoenas did not “effectively quash[]” those
subpoenas. See supra ¶ 13.
¶48 Second, Burns’ subpoenas and requests were not, in fact, an
inspection or investigation authorized by section 4, but instead they formed
part of a contested rate case subject to Commission authority. The Arizona
Constitution grants the Commission, not individual commissioners, “full
power” to prescribe just and reasonable utility rates (except as to towns and
cities). See Ariz. Const. art. 15, § 3; see also Johnson Utils., L.L.C. v. Ariz. Corp.
Comm’n, 249 Ariz. 215, 221 ¶ 21 (2020) (describing the Commission’s
ratemaking authority as plenary and exclusive). This “full power” includes
directing “the timing, procedure, or methods the Commission uses in
calculating rates.” See id. at 222 ¶ 25. Also, subject to statutory or
constitutional restraints, the Commission, not individual commissioners,
has full authority to establish procedures for prescribing rates and to
preside over proceedings initiated thereunder. See Ariz. Const. art. 15, § 6
2 What can an individual commissioner do when a publicly owned
corporation or a PSC refuses to comply with inspection and investigation
requests? Because section 4 does not direct how an individual
commissioner can compel enforcement with a subpoena or other inspection
request, and no statutes or Commission rules otherwise apply, an
individual commissioner’s only remedy is to seek declaratory and
injunctive relief from the superior court. See §§ 12-1831 to -1846. The court
can then resolve any disputes between the commissioner and the targeted
company and enter appropriate orders. See Polaris Int’l Metals Corp. v. Ariz.
Corp. Comm’n, 133 Ariz. 500, 506 (1982) (“Courts must have the power to
curb administrative investigations in appropriate instances.”). The
Commission as a whole is left out of the matter. Burns filed such a lawsuit
with the superior court, which nevertheless required him to first ask for
relief from the Commission. As explained hereafter, this was not error
because Burns’ requests were not part of a solitary investigation but instead
formed part of a rate case.
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BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
VICE CHIEF JUSTICE TIMMER, Dissenting
(empowering the Commission, absent statutory directives, to promulgate
rules and regulations to govern proceedings pending before it); see also
Johnson Utils., 249 Ariz. at 227 ¶ 52 (recognizing that Commission authority
is subject to judicial review). The Commission has exercised this authority
by promulgating rules of practice and procedure for rate cases. See
R14-2-103, -105; R14-3-101 to -113. As the majority suggests, see supra ¶ 33,
these rules govern contested cases before the Commission but do not apply
to investigations by the Commission or individual commissioners.
¶49 By filing his motions, Burns did not “inspect and investigate”
as authorized by section 4. Instead, he participated in the rate case by
issuing discovery requests through subpoenas and seeking rulings from the
ALJ and the Commission to enforce his individual determination of what
was relevant and admissible in the rate case. Had he issued his subpoenas
in his 2015 docket or opened another docket for investigatory purposes
while the rate case was pending, I would agree that the other
commissioners had no authority to interfere with his efforts to investigate
APS and Pinnacle West’s spending. But section 4 did not authorize him
under the guise of an “investigation” to hijack a contested rate case
involving numerous parties that properly followed procedures laid out by
the Commission under its constitutional authority. See Ariz. Const. art. 15,
§ 6. In short, the Commission did not interfere with Burns’ investigation; it
properly invoked its quasi-judicial powers in the rate case to rule on Burns’
motions. See Sun City Home Owners Ass’n. v. Ariz. Corp. Comm’n, 252 Ariz.
1, 5 ¶ 17 (2021).
¶50 The majority’s opinion has lasting consequences that both
violate the constitution and leave confusion, and potentially chaos, in its
wake. Now individual commissioners can compel the Commission to
enable and enforce their inspection and investigation efforts, despite the
plain language of section 4, which does not direct that result. Also, an
individual commissioner, under the pretext of inspecting and investigating,
now can determine what discovery is permissible in rate cases, despite
section 3, which explicitly gives the Commission as a whole full power to
make those decisions. It remains uncertain whether an individual
commissioner may be permitted to insist that certain witnesses be called
and questioned at a rate case hearing, as Burns argues is within his
constitutionally bestowed investigatory right. Regardless, it is not difficult
to imagine that the flow in rate cases could quickly enter choppy waters,
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BURNS V. ARIZONA PUBLIC SERVICE COMPANY, ET AL.
VICE CHIEF JUSTICE TIMMER, Dissenting
particularly if individual commissioners exercise their investigatory
powers in conflicting ways.
¶51 For all these reasons, although I agree with much of the
majority’s analysis, I respectfully disagree that the Commission here
prevented Burns from exercising his investigatory powers under section 4.
I would therefore affirm the superior court’s judgment.
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