Booth v. Consumers Power Co.

Young, J. Petitioners originally requested declaratory rulings from the Michigan Public Service Commission (psc) regarding Consumers Power Company’s actions in connection with a financial assistance program administered by the Department of Social Services (dss). In its findings, the PSC ruled that Consumers’ actions were exempt from the provisions of the — 370 — Michigan Consumers Protection Act (mcpa), MCL 445.901 et seq.] MSA 19.418(1) et seq. pursuant to MCL 445.904(l)(a); MSA 19.418(4)(l)(a). Petitioners appealed the psc determination to the circuit court, which reversed the psc’s ruling. The circuit court concluded that the psc lacked jurisdiction to determine whether Consumers was exempt under the mcpa. Respondents psc and Consumers were initially denied leave to appeal in the Court of Appeals. The Supreme Court, in lieu of granting leave, remanded the case to the Court of Appeals for consideration as on leave granted. 450 Mich 909 (1995). On remand, we affirm. Petitioners were utility customers of Consumers under the DSS-administered positive billing program. Under that program, the DSS would pay the utility bills of public assistance recipients directly to Consumers. Consumers would bill the dss directly, but also send statements to the program recipients. These statements contained a notation that read “dss energy program — do not pay.” Starting in October 1991, the dss limited the amount it would pay directly to Consumers on behalf of an individual recipient, and it deducted a portion of the recipient’s public assistance check to pay the utility bill. Consumers would also grant the recipient a credit matching the amount deducted from the assistance check. Despite this system of direct payment, deduction, and credit, some program recipients still accumulated arrearages. However, they were protected from having their utilities shut off as long as they were enrolled in the program. During the time that positive billing program enroll-ees were allowed to accumulate arrearages, Consumers continued to send out statements containing the “do not pay” notation. — 371 — In October 1991, the positive billing program was revised so that enrollees who had accumulated large arrearages were no longer allowed to participate. Petitioners were among those who had accumulated arrearages and were dropped from the program. The “do not pay” notation was removed from monthly statements in November 1991. Before the petitioners requested a declaratory ruling by the PSC, a group of former positive billing program enrollees filed suit against Consumers under the mcpa. The circuit court in that case dismissed the MCPA action for failure to exhaust available administrative remedies before the PSC. Petitioners in the instant case filed a request for a declaratory ruling by the PSC pursuant to § 63 of the Administrative Procedures Act, MCL 24.263; MSA 3.560(163). Petitioners asked the PSC to find that (1) Consumers’ imposition of penalties for nonpayment of arrearages accumulated in connection with bills stamped “do not pay” was not conduct regulated by the PSC, (2) the conduct complained of was not specifically authorized by any laws administered by the PSC, (3) the challenged conduct was not unlawful under the Public Service Commission Act or any regulations promulgated thereunder, and (4) the PSC did not have jurisdiction to hear, decide, and fashion remedies in connection with the challenged practice, and therefore aggrieved customers would have to seek relief under the mcpa in the circuit court. In its declaratory ruling, the PSC found that Consumers’ conduct fell within the exception to the mcpa set forth at MCL 445.904(l)(a); MSA 19.418(4)(l)(a) because the PSC “exercises pervasive regulatory authority over all aspects of Consumers’ relationship — 372 — with its customers, including billing disputes and shutoff of service, and can promptly take action to remedy misconduct by a public utility.” Petitioners sought review of the psc’s decision before the circuit court, arguing that the psc lacked the authority to determine whether Consumers’ conduct fell within an exception to the MCPA. The circuit court reversed the psc’s ruling on the basis that the PSC lacked subject-matter jurisdiction to determine the scope of the mcpa. The circuit court reasoned: [The] psc’s declaratory ruling that the Consumers Power Co.’s conduct is exempt from the Consumer Protection Act is not authorized by law, and is unlawful and unreasonable. . . . The PSC does not administer the Consumer Protection Act .... The Court notes also . . . that Petitioners never requested a ruling on the exemption issue. Moreover, the power granted to the psc in MCL 445.918 [MSA 19.418(18)] to investigate a public utility which the Commission believes may be engaging in unlawful conduct, does not include the power to make a determination as to whether the conduct is exempt from the . . . [MCPA], If the Legislature had intended to grant that significant power to the psc, it would have included that in the statute. Its failure to do so is a clear indication that the power to determine whether conduct is exempt from the Act is properly left to the courts. Finally, the broad grant of power to the psc found in MCL 460.6 [MSA 22.13(6)] does not include the power to determine the applicability to public utilities of other statutes the psc does not administer. If that were the case, the psc would be usurping the function of courts. The circuit court remanded the matter to the PSC for declaratory rulings regarding the issues presented by petitioners. — 373 — i Respondents argue that the circuit court erred in concluding that the psc could not determine whether Consumers’ conduct was exempt from the provisions of the MCPA. We find no error. Const 1963, art 6, § 28 provides that the review of an administrative agency’s final decision “shall include, as a minimum, the determination whether such final decisions, findings, rulings and orders are authorized by law.” Similarly, MCL 24.306; MSA 3.560(206) requires that courts “set aside a decision or order of an agency if substantial rights of the petitioner have been prejudiced” because the decision or order is “[i]n excess of the statutory authority or jurisdiction of the agency.” MCL 24.306(l)(b); MSA 3.560(206)(l)(b). It is well established that the psc has no inherent or common-law powers. Union Carbide Corp v Public Service Comm, 431 Mich 135, 146; 428 NW2d 322 (1988). As a creation of the Legislature, it possesses only that authority specifically granted by statute. Id.; In re Telecommunications Tariffs, 210 Mich App 533, 539; 534 NW2d 194 (1995). Moreover, a “statute that grants power to an administrative agency must be strictly construed and the administrative authority drawn from such statute must be granted plainly, because doubtful power does not exist.” Id. MCL 24.263; MSA 3.560(163) provides: “On request of an interested person, an agency may issue a declaratory ruling as to the applicability to an actual state of facts of a statute administered by the agency or of a rule or order of the agency.” (Emphasis added.) We conclude that the psc lacked authority to issue a declaratory ruling regarding the scope of the MCPA — 374 — because it does not administer that statute. The mcpa does give the psc a role in investigating violations of that act. Section 18(1) of the MCPA provides: “The public service commission may investigate ... a public utility subject to its jurisdiction . . . which the commission believes has engaged, is engaging, or is about to engage in a method, act, or practice which is unlawful under this act.” MCL 445.918(1); MSA 19.418(18)(1). However, the PSC plays no role in administering or enforcing the MCPA. In fact, after investigating a public utility under § 18(1), the PSC is directed to report its findings to the Attorney General. MCL 445.918(3); MSA 19.418(3). There are no provisions in the mcpa expressly granting the PSC authority to administer the act or allowing the psc to decide whether a utility’s conduct falls within the exception provided by MCL 445.904(l)(a); MSA 19.418(4)(l)(a). Without such a plain delegation of authority, we conclude that the PSC did not have subject-matter jurisdiction to issue a declaratory ruling regarding whether Consumers’ conduct fell under an exception to the MCPA. Respondent Consumers argues that the PSC’s declaratory ruling was correct and should be affirmed in any event. This issue was not presented to or decided by the circuit court, which considered only whether the PSC had jurisdiction to issue its declaratory ruling. Whether the PSC’s ruling was legally correct is not properly before this Court and will not be considered. Stark Steel Corp v Michigan Consolidated Gas Co, 165 Mich App 332, 340; 418 NW2d 135 (1987); Michigan Mut Ins Co v American Community Mut Ins Co, 165 Mich App 269, 277; 418 NW2d 455 (1987). Affirmed.