Justia Utilities Law Opinion Summaries

Articles Posted in California Courts of Appeal
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To connect a California caller to a California recipient, long-distance carriers must purchase access to local exchange services provided by local carriers (switched access services). Long-distance carriers have no control over which local carrier will provide switched access services and “have no choice but to use this service." In its complaint to the Public Utilities Commission, Qwest (a long-distance carrier) alleged that local carriers discriminated against it by providing other long-distance carriers, AT&T and Sprint, with discounted rates for switched access services. Qwest was not charged more than the rates set forth in the local carriers’ tariffs. The Commission concluded Qwest showed that it was similarly situated to AT&T and Sprint and that there was no rational basis for treating Qwest differently with respect to the rates. The court of appeal affirmed, rejecting challenges to the Commission failing to conduct an additional evidentiary hearing, finding Qwest was similarly situated to the Contracting Carriers without considering various factors the Commission identified in earlier Decisions; treating differences in the cost of providing service as the only “rational basis” for different rates; concluding Qwest is entitled to refunds; and in determining for the first time during the rehearing that switched access is a monopoly bottleneck service. View "Bullseye Telecom, Inc. v. California Public Utilities Commission" on Justia Law

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The Antelope Valley Groundwater Cases (AVGC) proceeding litigated whether the water supply from natural and imported sources was inadequate to meet the competing annual demands of water producers, thereby creating an overdraft condition. One of the competing parties, Appellant Tapia, individually and as trustee of a trust, claimed that he owned land overlying the aquifer. Settlement discussions ultimately produced an agreement among the vast majority of parties in which they settled their competing groundwater rights claims and agreed to support the contours of a proposed plan designed to bring the Antelope Valley Adjudication Area (AVAA) basin into hydrological balance. Tapia was not among the settling parties. Accordingly, before considering whether to approve the Physical Solution for the AVAA basin, the trial court conducted a separate trial on Tapia's unsettled claims and defenses.The Court of Appeal concluded that the Physical Solution's allocation of the "native safe yield" (NSY) does not violate California's water priorities; the allocations to correlative rights holders accord with California law; the Physical Solution's allocation of the NSY does not violate California's principles promoting the reasonable and beneficial use of water; and substantial evidence supports the judgment as to Tapia, and the Physical Solution is consistent with California law governing water priorities and the constitutional reasonable and beneficial use requirement. View "Los Angeles County Waterworks District No. 40 v. Tapia" on Justia Law

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Over 20 years ago, numerous parties alleged in the Antelope Valley Groundwater Cases (AVGC) that, without a comprehensive adjudication of all competing parties' rights to produce water from and a physical solution for the aquifer, the continuing overdraft of the basin would negatively impact the health of the aquifer. In this case, the trial court was required to find a physical solution that balanced the needs of thousands of existing users, all of whom competed for the scarce water that replenished the aquifer underlying the Antelope Valley Adjudication Area (AVAA), and to craft its provisions to protect the long-term health of the aquifer and the region's residents. The trial court determined that severely reduced water usage was required of existing users, and that severely curtailed access was required for future users. On appeal, the Willis Class challenged the judgment approving the Physical Solution, a proposed plan designed to bring the AVAA basin into hydrological balance.The Court of Appeal affirmed the trial court's judgment and concluded that the Physical Solution adequately balanced the competing interests of the parties within the parameters of governing California law and was not inconsistent with the terms of the Settlement. Thus, the court did not abuse its discretion when it equitably apportioned the available groundwater and placed limits and conditions on future pumping. Furthermore, the court rejected Willis's claims that the limits placed on Willis's post-Settlement participation in the litigation amounted to a denial of due process. The court explained that Willis was afforded an adequate notice and opportunity to present its contentions as part of the lengthy process of crafting the final Physical Solution. View "Willis v. Los Angeles County Waterworks District No. 40" on Justia Law

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Under section 225.1.4 of the Torrance Municipal Code, consumers of electricity must pay Torrance a tax on the charges for electricity and ancillary services they use. Edison is required to collect this tax from consumers and remit it to Torrance. Torrance filed suit against Edison after it discovered that Edison had calculated the electricity users' tax as a percentage of the net amount Edison was billing its consumers. However, Torrance contends that the electricity tax ordinance does not permit Edison to apply the IA credit to reduce electricity consumers' tax base, thereby reducing Torrance's tax revenue. The trial court sustained Edison's demurrer to Torrance's original complaint without leave to amend and entered a judgment of dismissal.The Court of Appeal agreed with Torrance that the electricity tax ordinance cannot reasonably be construed in the manner proposed by Edison and adopted by the trial court. However, the court agreed with Edison that Torrance cannot recover unpaid taxes from Edison and must instead amend its complaint to include electricity consumers as defendants. In this case, electricity consumers are liable to Torrance with respect to the taxes owed but not collected by Edison in the past. Therefore, the court explained that Torrance should be allowed to amend its complaint to include as defendants the electricity consumers at issue. Accordingly, the court reversed and remanded for further proceedings. View "City of Torrance v. Southern California Edison Co." on Justia Law

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In a prior opinion, a panel of the Court of Appeal determined the tiered water rate system used by the City of San Juan Capistrano (the City) violated the California Constitution. The City offered to refund its water ratepayers the difference between what they paid and what they should have paid for a 10-month period of time, in exchange for a release of other claims against the City related to the tiered water rate system. Plaintiffs Hootan Daneshmand, Brian Montgomery, and John Bottjer were ratepayers in the City. Bottjer signed the release and received a refund; Daneshmand and Montgomery did not. Plaintiffs later filed a notice of claim against the City, on behalf of themselves and a putative class of ratepayers, to recover the difference between what they paid and what they should have paid during the entire time the tiered water rate system was in place. The City denied the notice of claim, which was filed more than one year after the last bill under the tiered water rate system was due, as untimely under Government Code section 911.2. The Court of Appeal determined claims of Bottjer and the other ratepayers who obtained a refund from the City were barred by the release those ratepayers signed. Contrary to Plaintiffs’ arguments on appeal, the release was valid and enforceable. Further, Plaintiffs’ causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing were properly dismissed by the trial court. Finally, the claims of Daneshmand, Montgomery, and the other ratepayers who did not accept the City’s refund offer were barred because the notice of claim was filed more than one year after the claims accrued. Plaintiffs failed to show that waiver or any other legal or equitable doctrine affected the application of Government Code section 911.2 in this case. View "Daneshmand v. City of San Juan Capistrano" on Justia Law

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After the passage of Proposition 218, Sacramento voters approved a requirement that city enterprises providing water, sewer, storm drainage, and solid waste services pay a total tax of 11% of their gross revenues from user fees and charges. Nineteen years later, plaintiff-respondent Russell Wyatt brought a petition for writ of mandate and complaint for declaratory relief against the City challenging its fees and charges for utility services under article XIII D, section 6, subdivision (b) of the California Constitution (added by Prop. 218, as approved by voters, Gen. Elec. (Nov. 5, 1996)). It was undisputed that the City set these fees and charges at rates sufficient to fund the payment of the tax to its general fund. The trial court issued a writ of mandate and judgment in Wyatt’s favor. The Court of Appeal reversed the judgment and directed the trial court to vacate its writ of mandate. By approving the tax in 1998, Sacramento voters increased the cost of providing utility services, rendering those costs recoverable as part of their utility rates and the subsequent transfer of funds permissible under article XIII D. View "Wyatt v. City of Sacramento" on Justia Law

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The Antelope Valley Groundwater Cases (AVGC) proceeding litigated whether the water supply from natural and imported sources, which replenishes an alluvial basin from which numerous parties pumped water, was inadequate to meet the competing annual demands of those water producers, thereby creating an "overdraft" condition. Phelan, which provides water to its customers who are located outside the Antelope Valley Adjudication Area (AVAA) boundaries, became subject to the AVGC litigation because a significant source of its water is pumping from a well (Well 14) located in the AVAA basin. The trial court's judgment and adopted Physical Solution concluded that, while Phelan held no water rights in the AVAA basin, Phelan could continue operating Well 14 to draw up to 1,200 afy to distribute to its customers outside the AVAA, on condition that Phelan's pumping causes no material harm to the AVAA basin and that Phelan pays a "Replacement Water Assessment" for any water it pumped for use outside the AVAA.The Court of Appeal concluded that substantial evidence supports the judgment as to Phelan; the trial court correctly rejected Phelan's claim that it had cognizable water rights as an appropriator for municipal purposes; Phelan was not deprived of its due process rights to present its claims; and the trial court did not err in rejecting Phelan's claim to return flows from native water it pumped from the AVAA basin. Accordingly, the court affirmed the judgment as to Phelan. View "Phelan Piñon Hills Community Services District v. California Water Service Co." on Justia Law

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After the Regional Board issued a permit authorizing the County and certain cities (collectively, the Operators) to operate stormwater drainage systems, some of the Operators filed claims with the Commission seeking a determination that the state must reimburse them for the costs related to the trash receptacle and inspection requirements pursuant to article XIII B, section 6 of the California Constitution. After the Commission determined that the trash receptacle requirement is a reimbursable state mandate and that the inspection requirements are not, the state agencies filed a petition in the superior court for a writ of administrative mandamus to command the Commission to set aside its decision concerning the trash receptacle requirement. The local governments filed a cross-petition challenging the Commission's decision as to the inspection requirements. The superior court granted the state agencies' petition and denied the cross-petition as moot.The Court of Appeal held that, under Government Code section 17556, subdivision (d), when, as here, the state imposes on local governments a new program or higher level of service, the state is not required to provide subvention to the local government if the local government "has the authority to levy service charges, fees, or assessments sufficient to pay for the mandated program or increased level of service." The court reversed the superior court's judgment and agreed with the Commission that the local governments have the authority to levy service charges, fees, or assessments sufficient to pay for the inspection requirements, but not for the trash receptacle requirement. Therefore, the trash receptacle requirement requires subvention under section 6. View "Department of Finance v. Commission on State Mandates" on Justia Law

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This is one of several cases involving disputes between Malaga and the agencies involved in issuing and enforcing the permits necessary for Malaga to operate its waste treatment facility. In this case, Malaga wanted a wastewater discharge permit allowing it to discharge 0.85 million gallons per day (mgd) into certain disposal ponds. Malaga seeks to set aside the trial court's decision that the permit allowed a discharge of 0.85 mgd, arguing that the permit actually limited Malaga to discharging 0.49 mgd.After noting Malaga's aggressive approach, the Court of Appeal stated that it was unclear why litigation of this type was necessary when alternative administrative procedures could have resolved this issue in a faster and more efficient manner. The court concluded that the primary issue raised in this case is sufficiently important to warrant the use of the court's discretion to hear issues that are technically moot. The court held that the verification process included in Malaga's permit constituted an improper delegation of authority from the Water Quality Board to its executive officer. However, the court did not reach the parties' remaining issues, because those issues were not part of the trial court's final judgment, were not resolved in the first instance by the trial court, and are thus insufficiently developed to determine whether they could either support the trial court's judgment or require vacating the entire permit issued. Accordingly, the court reversed and remanded for further proceedings. View "Malaga County Water District v. Central Valley Regional Water Quality Control Board" on Justia Law

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This is one of several cases involving disputes between Malaga and the agencies involved in issuing and enforcing the permits necessary for Malaga to operate its waste treatment facility. In this case, the Water Quality Board imposed penalties totaling $78,000 on Malaga for violating the water discharge requirements of its permit. Malaga contends that these penalties were inappropriately imposed for several reasons.The Court of Appeal agreed with Malaga that laches is a proper defense in administrative sanctions proceedings, and that the Water Quality Board utilized a void underground regulation when it issued the "Hearing Procedure for Administrative Civil Liability Complaint R5-2013-0527" (Hearing Procedure). The court explained that the first issue may only affect some of the penalties imposed by the Water Quality Board while the second may require a full rehearing. Therefore, the court reversed the trial court's order and remanded the matter to the trial court to determine whether a writ should issue based on one or both of Malaga's right to present a laches defense and the Water Quality Board's use of a void underground regulation via the Hearing Procedure. The court affirmed in all other respects. View "Malaga County Water District v. State Water Resources Control Board" on Justia Law