State ex rel. North Carolina Utilities Commission v. New Hope Road Water Co.

Denny, J.

The solo question for decision on this appeal is whether or not the respondents are public utilities within the meaning of GS 62-65(e) 2, which reads as follows: “The term ‘public utility,’ when used in this article, includes persons and corporations, or their lessees, trustees and receivers now or hereafter owning or operating in this State equipment or facilities for: Diverting, developing, pumping, impounding, distributing or furnishing water to or for the public for compensation.”

The Commission has no jurisdiction over these respondents unless they are public utilities within the meaning of GS 62-65 (e) 2. GS 62-27. Moreover, the General Assembly has vested in the courts of this State the power to review proceedings before the Commission and to determine whether or not the appellants have been prejudiced because the Commission’s findings, inferences, conclusions or decisions are, among other things, in excess of the statutory authority or jurisdiction of the Commission; or unsupported- by competent, material arid substantial evidence. GS 62-426.10. ' - -

While it is apparent from-the evidence that these respondents-have sold taps'to all persons applying therefor; they had no choice-in the matter if they are public utilities. Halifax Paper Co. v. Sanitary District, 232 N.C. 421, 61 S.E. 2d 378.

In the last cited case; it is said; “A'public utility, whether publicly or privately owned, ‘is under a legal obligation to serve the members of the public to whom its use extends, impartially and without-unjust discrimination ':i * A public utility must serve alike all who are similarly circumstanced with reference to its system, arid favor can-riót be extended to one which is not offered to another, nor can a privilege given one be refused to another.’ 43 Am. Jur., 599; 51 C.J., 7. This is in accord with our decisions. Public Service Co. v. Power Co., 179 N.C. 18, 101 S.E. 593; Solomon v. Sewerage Co., 133 N.C. 144, 45 S.E. 536; Griffin v. Water Co., 122 N.C. 206, 30 S.E. 319.”'

In 73 C.J.S., Public Utilities, section 2, page 993,' it' is said: “It has been stated that the true criterion by which to determine whether a plant or system is a public utility is whether or not the public may enjoy it of right or by permission only (Johnson City v. Milligan Utility District, 38 Tenn. App. 520, 276 S.W.,2d 748; Junction Water Co. v. Riddle, 108 N.J.Eq. 523, 155 A 887; Richardson v. Railroad Commission, 191 Cal. 716, 218 P 418; Springfield Gas Co. v. Springfield, 292 Ill. 236, 127 N.E. 739) * * * and an attempt to declare a cornpahy or enterprise to be a public utility where it is inherently -not such, is, by virtue of the guaranties of the federal Constitution, void wherever it interferes with private rights of property or contract * * * and the question whether or not a particular company or service is a public utility is a jiidicial one which must be determined as such by a court of competent jurisdiction.” Natatorium Co. v. Erb, 34 Idaho 209, 200 P 348.

The case of Austin, et al v. City of Louisa (Court of Appeals of Kentucky), 264 S.W. 2d 662, was filed for a declaration of .rights against the City of Louisa, the'Louisa Water Commission, and three individuals, Lonnie Boggs, H. T. Kerns and Con.Limmings. The individuals, Boggs, Kerns and Limmings, as well as the plaintiffs, owned homes on Inez Road, just east of the City of Louisa. Some time in 1949 the appellees, Boggs, Kerns and'Limmings, built at a cost-of $1,500 a private water line from their homes to a water main, in the City of Louisa.

Subsequently, Bobbs and his associates permitted neighbors to tap onto the line in question, until at the time the action -was brought approximately 22 families in all were using it. Each-neighbor who tapped onto the line paid the original builders $100.00 and signed a contract whereby he or she agreed riot to hold the original builders-responsible for loss of service. In addition, each person agreed to share the expense of maintenance. The taps and meters were installed by the Water Department of the City of Louisa. The City of Louisa sold water through the private line and collected therefor.

A Mir. Griswold paid the $100.00, signed the contract and constructed a tap line from the original one to his house. He then permitted the plaintiff Austin to tap his lateral line and obtain service without paying the tap fee of $100.00 or signing the contract required by the original builders of the line. The Court said: “Any rights appellants may have had to receive water depended necessarily upon the willingness of Boggs, Kerns and Limmings to permit appellants to tap onto the private line. * *

“Nor do we feel that appellants have any grievances against Boggs, Kerns and Limmings'which are cognizable at law. Clearly, the latter persons, are not, as appellants contend, operating a public utility so as to bring them'within the regulatory jurisdiction of the Public Service Commission. The fee of $100 and the additional conditions in the contract, signed by some twenty or more neighbors who were permitted to use this limited line, represent a reasonable means of spreading the cost of construction and maintenance of the line. Moreover, the three men have meters installed in their homes and pay the city for the water used by them, just as any user within the city would be required to do. It is obvious that this is not a case of distribution of water ‘for compensation’ by Boggs and associates, KRS 278.010(d), as would make the Boggs line a public utility.”

Section 278.010, Kentucky Revised Statutes, reads as follows: “(3) ‘Utility’ means any person, except a water district organized under Chapter 74 or a city, who owns, controls, operates or manages any facility used or to be used for or in connection with: (d) The diverting, developing, pumping, impounding, distributing, or furnishing of water to or for the public, for compensation-!’ The legal effect of this statute is identical .with our own.

In Overlook Development Co. v. Public Service Commission, 101 Pa.Super.Ct. 217, 306 Pa. 43, 158 A 869, it was held that a land company which plotted a tract of land owned by it for development purposes, sold lots and contracted with a water company for a supply of water through the mam constructed by the land company at its own expense and owned, by it, did not engage in the business in supplying water to the public by reason of the fact that it permitted those to -whom it sold lots and several neighboring owners to connect with its main and be served with water through it by the water company. The Court further held: “ * * * The mere fact that this water main became- a- facility of the water company did not destroy the private character of.the main, nor render it subject-to use by .the water company in supplying water to the public generally, or to any portion of the public as such. If this be not so, then one cannot construct a water main on his own land, connect it with a main of a public service company, and receive service through it from the company without impressing it with a public use which would require him to permit any other person in the neighborhood who might desire service from the company, to connect with his main. * * ® A public utility may be compelled under proper circumstances to extend its facilities to accommodate the public, but the private property of an individual cannot be appropriated for that purpose without due process and without making or securing compensation.” See Anno: Public Utility—Incidental Service, 18 ALR 764; 93 ALR 248; 132 ALR 1495. Cf. Allen v. Railroad Commission, 179 Cal. 68, 175 P 466.

In our opinion, the mere fact that these respondents own the respecT tive water lines or mains described hereinabove, and that such lines are used by the City of Gastonia for selling water for compensation, does not support the findings of fact to the effect that the respondents are engaged in selling water to the general public for compensation within the meaning of GS 62-65 (e) 2, and are, therefore, public utilities. The respondents have not sold water to any one, at any time, for compensation or otherwise. Moreover, the City of Gastonia can only furnish water service through these private lines to a party who has purchased a tap from the owners thereof. The City has no right to sell a tap on these lines, neither does it have the right to install one without permission of the respective owners thereof. Consequently, we hold that these respondents are not public utilities within the meaning of the provisions of the above statute. Hence, the judgment of the court below is

Affirmed.