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A. Finkl & Sons Co. v. Illinois Commerce Comm'n

Case Date: 09/26/2001
Court: 4th District Appellate
Docket No: 4-00-0570, 0596 cons. Re

NOS. 4-00-0570, 4-00-0596 cons.

IN THE APPELLATE COURT

OF ILLINOIS

FOURTH DISTRICT

A. FINKL and SONS COMPANY; ABBOTT
LABORATORIES, INC.; CATERPILLAR, INC.;
DAIMLER CHRYSLER CORPORATION; FORDMOTOR COMPANY; MODERN DROP FORGECOMPANY, INC.; MONSANTO COMPANY;MOTOROLA, INC.; NABISCO BRANDS, INC.;NORTHWESTERN STEEL and WIRE COMPANY;OWENS-ILLINOIS, INC.; R.R. DONNELLEYand SONS; and VISKASE CORPORATION,

              Petitioners,

              v. (No. 4-00-0570)

THE ILLINOIS COMMERCE COMMISSION,
ILLINOIS POWER COMPANY, COMMONWEALTH
EDISON COMPANY, and THE PEOPLE OF THE
STATE OF ILLINOIS EX REL. JAMES E.RYAN, ATTORNEY GENERAL,

              Respondents.

--------------------------------------

THE PEOPLE OF THE STATE OF ILLINOIS ex
rel. JAMES E. RYAN, ATTORNEY GENERAL,

              Petitioner,

              v. (No. 4-00-0596)

COMMONWEALTH EDISON COMPANY; THE
ILLINOIS COMMERCE COMMISSION; ILLINOIS
POWER COMPANY; A. FINKL and SONS
COMPANY; ABBOTT LABORATORIES, INC.;
CATERPILLAR, INC.; DAIMLER CHRYSLER
CORPORATION; FORD MOTOR COMPANY;MODERN DROP FORGE COMPANY, INC.;NABISCO BRANDS, INC.; NORTHWESTERNSTEEL and WIRE COMPANY; OWENS-ILLINOIS, INC.; R.R. DONNELLEY andSONS; and VISKASE CORPORATION,

              Respondents.

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 Administrative 
Review of the
Illinois Commerce
Commission
No. 00-0259




























______________________________________________________________________________________________

PRESIDING JUSTICE STEIGMANN delivered the opinion ofthe court:

On March 31, 2000, respondent Commonwealth EdisonCompany (ComEd) filed a petition with respondent Illinois Commerce Commission (ICC) seeking expedited approval of the implementation of a market-based alternative tariff to become effective on or before May 1, 2000. Several parties filed petitionsto intervene, including petitioners, the People of the State ofIllinois ex rel. Attorney General James E. Ryan (Attorney General), and A. Finkl et al., collectively known as the IllinoisIndustrial Energy Consumers (Consumers). On April 27, 2000, theICC issued an "interim order," authorizing ComEd to file tariffsthat contained the ICC's proposed modification, with such tariffsto become effective May 1, 2000. In June 2000, the ICC deniedthe applications for rehearing, which were filed by the AttorneyGeneral and Consumers. Both the Attorney General (No. 4-00-0596)and Consumers (No. 4-00-0570) appealed, and we allowed ComEd'smotion to consolidate the two appeals.

On appeal, petitioners argue that (1) the April 2000order was not a "pass-to-file decision" pursuant to section 9-201of the Public Utilities Act (Act) (220 ILCS 5/9-201 (West 2000));(2) the ICC did not properly waive the 45 days' notice requirement; (3) the ICC failed to provide a formal hearing; (4) the ICCfailed to comply with its own regulations; (5) the April 2000order is not supported by substantial evidence and lacks sufficient findings and analysis; (6) the tariffs allowed to go intoeffect under the April 2000 order do not comply with section 16-112 of the Act (220 ILCS 5/16-112 (West 2000)); (7) the ICCfailed to find that ComEd's rate changes were "just and reasonable" pursuant to section 9-201(c) of the Act (220 ILCS 5/9-201(c) (West 2000)); and (8) ComEd failed to meet its burden ofproving that the rate changes were "just and reasonable." Weaffirm.

.

I. BACKGROUND

On March 31, 2000, ComEd filed a "[p]etition forexpedited approval of implementation of a market-based alternative tariff, to become effective on or before May 1, 2000,pursuant to [a]rticle IX and [s]ection 16-112 of the [Act (220ILCS 5/16-112 (West 2000))]." ComEd attached to its petition thefollowing: (1) a summary of the market-based proposal, (2) drafttariffs, (3) supporting testimony of three experts, (4) fivesupporting affidavits from other interested parties, (5) asummary description of the contingent wholesale offer, and (6) adraft order.

To achieve the May 1, 2000, effective date, Com Ed'spetition proposed the following schedule: (1) that the ICC issuea notice on or before April 5, 2000, requesting that any petitionto intervene or objections to the petition be filed on or beforeApril 10, 2000; (2) any hearing be held on or before April 17,2000; (3) a hearing examiner's proposed order be issued on orbefore April 21, 2000, with exceptions due on April 24, 2000; and(4) an be order entered on April 27, 2000.

The ICC appointed Larry Jones as the hearing examinerfor the proceedings. On April 3, 2000, Jones set a prehearingconference for April 13, 2000. On April 5, 2000, Jones ruledthat April 10, 2000 (this deadline was later extended to April11) was the due date for responses to Com Ed's proposed procedural schedule. The Attorney General and Consumers filed petitions to intervene. Both Consumers and the ICC staff (Staff)objected to ComEd's proposed schedule. On April 10, 2000, theICC ruled that the matter should proceed in a manner that wouldyield an order on or before April 27, 2000.

On April 13, 2001, Jones held a prehearing conference. The first question addressed was whether the parties wanted touse verified statements rather than prefiled testimony followedby a cross-examination hearing. Consumers objected to the use ofverified statements because ComEd had already submitted prefiledtestimony. Several other intervenors raised similar concerns. Later during the conference, Consumers questioned under whatsection of article IX of the Act (220 ILCS 5/9-101 through 9-253(West 2000)) ComEd was proceeding. ComEd never answered Consumers' inquiries. Further, ComEd raised the issue of waiving theex parte rules for the proceedings.

The same day as the conference, Jones established thefollowing schedule: (1) any statements or comments on ComEd'spetition would be due April 18, 2000; (2) the hearing examiner'sproposed order was to be issued no later than April 24, 2000; (3)exceptions to the proposed order would be due at 3 p.m. on April25, 2000; and (4) replies to the exceptions would be due at 10a.m. on April 26, 2000.

On April 19, 2000, several parties, including ComEd,Consumers, and the Attorney General, filed comments. The Stafffiled affidavits and prepared testimony of two witnesses. OnApril 20, 2000, Jones ordered a revised schedule. The revisedschedule provided that the proposed order would be issued onApril 21, 2000, with exceptions due at 4 p.m. on April 24, 2000,and replies to the exceptions due at 12 p.m. on April 25, 2000.

On April 21, 2000, Consumers filed a motion to modifyor stay the proceedings, seeking the right to conduct discovery,cross-examination of witnesses, and to reply to the testimonyoffered by the Staff. The ICC never ruled on the motion.

That same day, Jones filed his proposed order. Petitioners point out that April 21, 2000, was Good Friday and claimthat Jones filed the order late in the day. The copy in therecord is not file stamped. The proposed order approved thetariffs with certain modifications and stated that the order wasfinal. On April 25, 2000, the Attorney General, ComEd, andConsumers filed briefs on their exceptions to the proposed order. On April 26, 2000, the Staff filed both a brief on exceptions anda reply brief on exceptions. The Attorney General, ComEd, andConsumers also filed reply briefs.

On April 27, 2000, the ICC filed an "interim order,"approving the tariffs with certain modifications and directingComEd to file the tariffs reflecting the methodology with themodifications. ComEd accepted the modifications and filed thetariffs on May 1, 2000. On May 30, 2000, the Attorney Generaland Consumers filed applications for rehearing. On June 7, 2000,the ICC entered an order to dismiss as premature the applicationsfor rehearing. Both Consumers and the Attorney General appealed.

ComEd filed a motion to dismiss the appeals, arguingthat the April 2000 order was not a final order, and Consumersfiled a motion to stay the ICC's proceedings. This court deniedboth motions. In its brief, ComEd again objects to this court'sjurisdiction, and we again reject ComEd's argument.

ComEd also argues that this appeal is moot. At oralarguments, petitioners conceded that, in light of the ICC's finalorder, dated April 11, 2001, any order issued by our court wouldbe merely advisory. However, we choose to address the issuespresented under the public interest exception to the mootnessdoctrine. See Citizens for a Better Environment v. IllinoisCommerce Comm'n, 103 Ill. App. 3d 133, 135, 430 N.E.2d 684, 686(1981).

II. ANALYSIS

A. Standard of Review

This case involves an order of the ICC, and thusjudicial review is limited. People ex rel. Hartigan v. IllinoisCommerce Comm'n, 148 Ill. 2d 348, 366, 592 N.E.2d 1066, 1074(1992). The ICC's findings of fact are prima facie correct, andthis court will not disturb those findings unless they are (1)against the manifest weight of the evidence, (2) beyond the ICC'sstatutory authority, or (3) violative of constitutional rights. Hartigan, 148 Ill. 2d at 367, 592 N.E.2d at 1074. Although theICC's interpretation of a question of law is not binding on thiscourt (Hartigan, 148 Ill. 2d at 367, 592 N.E.2d at 1074), we willaccord great deference to the ICC's interpretation of the Act'sprovisions (Ameropan Oil Corp. v. Illinois Commerce Comm'n, 298Ill. App. 3d 341, 346, 698 N.E.2d 582, 586 (1998)). Moreover,the party appealing the ICC's decision has the burden of proof. This court can, in whole or in part, reverse and set aside theorder, affirm the order, or remand the cause to the ICC forfurther proceedings. Hartigan, 148 Ill. 2d at 367, 592 N.E.2d at1074.

B. Section 9-201 of the Act

In a traditional rate case under section 9-201 of theAct (220 ILCS 5/9-201 (West 2000)), the utility asks for a ratechange, and the ICC determines whether to suspend the tariffpending a hearing or to let it go into effect. CommonwealthEdison Co. v. Illinois Commerce Comm'n, 180 Ill. App. 3d 899,904, 536 N.E.2d 724, 728 (1988). The latter is known as passinga tariff to file, and the rate change goes into effect after 45days' notice. The ICC, for good cause shown, may allow ratechanges to go into effect without 45 days' notice. 220 ILCS 5/9-201(a) (West 2000). In this case, the Attorney General arguesthat the April 2000 order was not a decision to pass the tariffto file, while respondents assert that it was.

The Attorney General contends that this case cannot bea pass-to-file case because ComEd first sought approval of itsmarket-based methodology by means of a petition. However, undersection 255.30(j) of Title 83 of the Illinois Administrative Code(83 Ill. Adm. Code