Appeal from the Circuit Court of Madison County; the Hon.
JAMES O. MONROE, JR., Judge, presiding. Reversed and remanded.
Rehearing denied September 30, 1963.
This appeal involves the propriety of a decree entered in a class action brought on behalf of customers of the defendant Alton Water Company for refund of excess charges for water service furnished during the period of November 25, 1958 to August 1, 1960.
The defendant Alton Water Company was engaged in the business of furnishing water service to approximately 14,000 customers in Alton and neighboring areas. During the period from June 1, 1952 to January 1, 1958 it charged according to rates which had been approved by the Illinois Commerce Commission on May 20, 1952. On this appeal, these 1952 rates are referred to as the "100% Rates."
On February 5, 1957 defendant water company filed with the Illinois Commerce Commission a rate schedule proposing an increase in water rates of approximately 50% over the rates then in force. These rates are referred to as the "150% Rates." After a hearing, the Commission found that the 150% rates were unreasonable and directed the defendant water company to file a revised schedule, setting forth rates which the Commission found were just and reasonable. These rates provided for an increase of 47 1/2% over the 1952 rates, are hereinafter referred to as the "147 1/2% Rates," and were made effective as of January 1, 1958.
The City of Alton and others appealed from the Commission's order establishing the 147 1/2% rates to the Circuit Court of Madison County and on November 25, 1958 that court entered an order setting aside and vacating the order establishing the 147 1/2% rates. From that ruling, an appeal was taken to the Supreme Court of Illinois by the defendant water company and the Illinois Commerce Commission.
To stay the effect of the order of November 25, 1958, pending the appeal, the defendant water company posted a supersedeas bond in the amount of $270,000. On January 22, 1960 the Supreme Court issued its first opinion on the appeal. Petitions for rehearing were filed and on March 30, 1960 the Supreme Court filed a modified opinion, the concluding portion of which is as follows: (See 19 Ill.2d 76 at Page 93, 165 N.E.2d 513 at Page 523)
"For the reasons stated above, the circuit court properly reversed and set aside the order of the Illinois Commerce Commission. Its judgment must be modified, however, to order the cause remanded to the Commission for further proceedings in accordance with the views expressed in this opinion. (Citations) The judgment as so modified is affirmed."
The mandate of the Supreme Court was issued on April 1, 1960, was dated January 22, 1960 and filed in the Circuit Court on April 4, 1960. The mandate stated that the judgment of the Circuit Court of Madison County was affirmed in all things and was to stand in full force and effect notwithstanding the matters assigned for error "and modified to order the cause remanded to the Commission for further proceedings in accordance with the views expressed in the opinion." Costs were taxed against the appellant. A request for clarification and for an amendment of the mandate was made by the Commission and defendant water company, but the request was denied.
After the remand, upon motion of the defendants, the Circuit Court on May 9, 1960 entered an order pursuant to the mandate, remanding the cause to the Commission for further proceedings in accordance with the Supreme Court's opinion. On June 10, 1960 defendant water company filed a motion with the Commission requesting that it promptly effectuate the mandate.
On July 29, 1960 the Commission, without hearing any further evidence, entered an order authorizing the defendant water company to file a new schedule of rates effective August 1, 1960. The new rates established were equal to approximately 135.19% of the 1952 100% rates and will be referred to as the "135% rates."
An appeal was taken by the City of Alton and others from this new rate order to the Circuit Court of Madison County. The Circuit Court affirmed the new rate order and the Supreme Court reaffirmed on May 25, 1962. See 25 Ill.2d 112, 182 N.E.2d 665.
In the instant case, which is an original action brought in the Circuit Court of Madison County, the plaintiffs seek a refund for the period of time from November 25, 1958, when the Circuit Court set aside the 147 1/2% rates, to August 1, 1960, the effective date of the Commission's order establishing the present 135.19% rates. This period of time will be referred to herein as the "refund period." During this period of time, by virtue of the supersedeas bond, defendant water company collected rates in accordance with the 147 1/2% rate schedule.
The present suit was filed on April 1, 1960 and was brought to recover upon the supersedeas bond. Under it, plaintiffs claim they are entitled to a refund of the difference between the amount collected during the refund period and the amounts which would have been collected under the 1952 100% rate schedule. The Court held that the plaintiffs were correct in their position, that the amount of the refund due exceeded the amount of the bond, and entered judgment in favor of plaintiffs for the sum of $270,000 (the principal amount of the bond) plus interest, computed at 5% per annum from January 22, 1960, being the date of the Supreme Court's first opinion affirming the appeal on the 147 1/2% rate schedule.
On June 24, 1960, plaintiffs were granted leave to amend their complaint by adding Count II, a class action, alleging a common law claim for a refund of the difference between the amount collected during the refund period and the 1952 100% rate schedule, with interest at 5%. Under this count, the court found in favor of the plaintiffs for the difference between the amount collected during the refund period (147 1/2% rates) and the 1952 100% rates, together with interest at the rate of 5% per annum from November 25, 1958.
Counts I and II were referred by the trial court to a special master for hearing of evidence and oral arguments. After the master had heard evidence and was preparing a draft of his report, plaintiffs requested leave to further amend the complaint by adding a third count. Leave was granted on June 23, 1961 and Count III was added. It also was a representative suit and alleged a cause of action under Section 73 of the Public Utilities Act. (Ill Rev Stats 1961, c 111 2/3, § 77.) In Count III, plaintiffs asked for a refund in the same amount as under Count II and in addition demanded exemplary and punitive damages for alleged willfulness in charging the 147 1/2% rates from January 22, 1960 (the date of the first opinion of the Supreme Court) to August 1, 1960 (the effective date of the Commission's order setting up the 135.19% rates) and also asked for attorneys fees. The trial court held for plaintiffs on Count III and decreed that the defendant water company was liable to the plaintiffs for exemplary and punitive damages and for attorney fees for "wilfully charging said unlawful water rates."
The decree of the court further provided that the liability against the defendants under Counts I, II and III was not to be cumulative as to any or all of the plaintiffs and that liability or payment to the respective plaintiffs should be adjusted as equity required pro rata and pro tanto, as to all items.
The defendant water company recognizes that it must make a refund to plaintiffs, but it is the defendants' contention that they are liable only on Count I and then only to the extent of the difference between the amounts collected during the refund period (147 1/2%) and the amounts which would have been collected had the rates ultimately found to be just (135.19%) been in effect during the refund period, together with ...