Mountain States Telephone & Telegraph Co. v. Public Service Commission

ELLETT, Justice: This petition involves a review of a Report and Order entered by the Public Service Commission of Utah, hereinafter referred to as Commission, on May 15, 1973, requiring The Mountain States Telephone and Telegraph Company, hereinafter referred to as Mountain Bell, to provide extended area telephone service within certain areas of Utah County. The matter was heard by the Commission pursuant to a petition filed by Mountain Bell seeking approval to provide an optional calling service previously initiated in other parts of the state known as Metropolitan Preferred Area Calling, hereinafter called METROPAC. This service would offer to customers within Utah County the optional right to subscribe to the METROPAC arrangement pursuant to which they could call other customers within exchanges having their rate center within an 18-mile radius of the rate center in which the calling customer resides. A counter-petition was filed by Ernest H. Dean, a state senator, on behalf of himself and other citizens of Utah County [1145] seeking toll-free county-wide extended area service within Utah County. The Commission, in its Report and Order, ordered Mountain Bell to install the necessary facilities to provide additional Extended Area Service in three areas of Utah County as follows: (a) Between the exchanges in cities in the north half of the county, to wit: Lehi, American Fork, Pleasant Grove, and Provo; (b) between the exchanges in cities in the south half of the county, to wit: Provo, Spanish Fork, and Payson; and (c) between the exchanges of Goshen in the extreme south part of the county and Payson and Spanish Fork. The Order further provided that the customers in all of the various exchanges in Utah County, other than Springville and Goshen, would then fall into Rate Group 7 for purposes of determining their basic telephone rates. Mountain Bell is duly certificated to provide telephone service in all areas of Utah County with the exception of the town of Thistle. For many years, telephone service has been provided throughout Utah County with the county divided into eight exchanges which substantially coincide with the incorporated areas of the eight principal cities within the county. Prior to the initiation of the present case, arrangements existed which permitted customers in each of the exchanges, other than Pleasant Grove and Goshen, to call customers located in the immediately contiguous exchanges without toll charges. This right to call toll-free from one exchange into another is sometimes referred to as Extended Area Service, or EAS. Under the system of tariffs utilized by Mountain Bell and approved by the Commission, exchanges are grouped for rate purposes into various rate groups based upon the number of customers. A subscriber can call within his own exchange area and to adjacent exchanges under EAS. On February 7, 1972, Mountain Bell filed a petition with the Commission seeking approval of two proposals. The first proposal involved a request to provide EAS between Pleasant Grove and the Orem zone of the Provo exchange, which proposal was granted, and the service requested has been implemented. The second proposal was to provide METROPAC service to the exchanges in Utah County situated within 18 miles of the rate center in Provo. Under this arrangement, a resident customer would pay, in addition to the regular base rate, a monthly rate of $6.00 per month for a 180-minute allowance or a $4.00 charge for a 120-minute monthly allowance, with additional time above the initial allowance to be billed at the reduced rate of five cents per minute. This would mean that a customer having this service could call into other exchanges within an 18-mile radius toll-free for the total number of minutes per month purchased at a substantially reduced rate with additional minutes to be billed at a rate less than a regular toll charge. This would be an optional service for those customers desiring same. Two separate counter-petitions were filed by Ernest H. Dean on behalf of himself and other citizens of Utah County opposing the proposed METROPAC service and requesting the Commission to require Mountain Bell to provide Extended Area Service throughout all of Utah County. A hearing was held, commencing December 5, 1972, on the proposal of Mountain Bell to provide METROPAC service and on the issues raised by the counter-petitions. Senator Dean presented testimony from a number of Mountain Bell customers in Utah County, who testified that they would like county-wide Extended Area Service and would be willing to have a small increase in their telephone charges to receive this service. He himself testified at length with reference to a comparison of Utah County to Davis and Weber Counties to the north and also to the Salt Lake metropolitan area in an attempt to show that Utah County had been discriminated against in the kind of telephone service provided in that county. [1146] The Commission issued its Report and Order on May 15, 1973, ordering Mountain Bell to install the necessary plant and facilities to provide EAS (1) between the exchanges of Lehi, American Fork, Pleasant Grove, and Provo; (2) between the exchanges of Provo, Spanish Fork, and Payson; and (3) between the exchanges of Goshen, Payson, and Spanish Fork. The only rate adjustment provided for Mountain Bell under the Order was the fact that customers in each exchange would be changed to Rate Group 7 with the exception of the exchanges of Springville, which would remain in Rate Group 6, and Gosh-en, which would be changed to Rate Group 4. On June 4, 1973, Mountain Bell filed a Petition for Rehearing, which petition was denied by an Order of the Commission dated July 13, 1973. It is from the Order of the Commission dated May 15, 1973, and the denial of its Petition for Rehearing that Mountain Bell has appealed to this court. Mountain Bell claims that the order made is unlawful, arbitrary, and capricious, since it did not follow orders made in other counties having similar problems. It also claims that the Commission was subjected to undue influence by Mr. Dean, who is and was a member of the State Senate. It is claimed that when the members of the Commission were before the Senate Judiciary Committee on matters not related to the instant matter, Senator Dean lectured them regarding this matter, which was then pending, and that he urged them to enter the order which was finally made. The answer to the latter claim seems to lie in the fact that the Commission did not enter the order requested by Senator Dean in the counter-petition which he and many other citizens of Utah County had urged. It may be that the tactics of the' senator were unwise and improper. However, the likelihood of improper influence is small, since there are 28 other senators, none of whom tried to influence the commissioners. Complaint is also made because at a hearing before the Commission of this matter Senator Dean, a party thereto, was permitted to ask questions and make a statement not under oath. The statute1 provides: All hearings, investigations and proceedings shall be governed by this chapter and by rules of practice and procedure to be adopted by the public utilities commission; in the conduct thereof the technical rules of evidence need not be applied. No informality in any hearing, investigation or proceeding, or in the manner of taking testimony, shall invalidate any order, decision, rule or regulation made, approved or confirmed by the commission. It would thus appear that there was no reversible impropriety about that matter. In a prior proceeding involving another county, the commission had said: 8. It is obvious from the testimony and study in this matter that the solution to the situation which exists in North Davis County and other suburban areas of the state is not to simply continue to provide Extended Area Service outward from the metropolitan exchanges. Serious consideration must henceforth be given to the concept of usage-sensitive service in which the subscriber, within certain limitations, is charged for telephone service on the basis of the frequency, length and distance of the calls which he makes. 9. In considering future cases, this Commission will give serious consideration to the concept that EAS should, generally, be provided only between contiguous exchanges and that calling to more distant exchanges should be provided by some form of usage-sensitive service. [1147] Thus, broad generalizations of the policy which should be seriously considered was set out insofar as it related to suburban areas of the state. There is no reason to think that the Commission did not seriously consider the “usage-sensitive service” concept before making its ruling in the instant matter. However, even if the Commission did not fully consider the concept, it is not fatal to the ruling made in this case. The general law is stated in 73 C.J.S. Public Administrative Bodies and Procedure § 148 as follows: The doctrine of stare decisis, discussed generally in Courts §§ 186-216, is not generally applicable to the decisions of administrative tribunals; nor does a prior administrative determination ordinarily preclude a subsequent one on the grounds of equitable estoppel. Accordingly, administrative bodies are not ordinarily bound by their prior determinations or the principles or policies on which they are based. . Mountain Bell offered testimony to the effect that the cost of giving the service as ordered would necessitate an investment of some $4,749,300.00. Another expert witness estimated the cost to be $1,212,000.00. The Commission was not required to accept the higher figure of plaintiffs witness, and its proceedings and findings are presumed to be correct2 unless they are capricious or arbitrary or are not supported by testimony. One of the largest steel mills in the country is located in Utah County, and there are many smaller plants nearby to make use of its products. The area is thus fast becoming a manufacturing and commercial region. Men from all over the county work side by side in the various plants, and it appears that the continuance of eight separate and distinct phone exchanges is not in the public interest, and this is especially so where charges are being collected for a long-distance call, even though the two phones are in close proximity to each other, if in different exchange areas. We do not think we should substitute our judgment for that of the Commission in matters such as this where the evidence before the Commission justifies the order made and where it does not appear to be either arbitrary or capricious. The order made by the Commission is sustained. No costs are awarded. CROCKETT, TUCKETT and MAUGHAN, JJ., concur. Footnotes [1] Section 54-7-1, U.C.A.1953. [2] Garrett Freightlines, Inc. v. Hunt, 19 Utah 2d 234, 499 P.2d 981 (1967).