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Union Electric Co. v. Ill. Commerce Com.

OPINION FILED MAY 23, 1977.

UNION ELECTRIC COMPANY, PETITIONER-APPELLANT,

v.

ILLINOIS COMMERCE COMMISSION, RESPONDENT-APPELLEE. — (CERRO COPPER & BRASS COMPANY ET AL., INTERVENORS-APPELLEES.) — CERRO COPPER & BRASS COMPANY ET AL., PLAINTIFFS,

v.

ILLINOIS COMMERCE COMMISSION ET AL., RESPONDENTS.



APPEAL from the Circuit Court of Jersey County; the Hon. HOWARD LEE WHITE, Judge, presiding.

MR. JUSTICE TRAPP DELIVERED THE OPINION OF THE COURT:

Union Electric appeals to the circuit court upon an order of the Illinois Commerce Commission fixing utility rates entered April 17, 1973. The trial court dismissed the appeal as moot, but also affirmed the order of the Commission.

The issue of mootness arises from the circumstances that economic events in terms of operating costs require frequent adjustment of rates. In May 1972, Union filed a schedule of rates with the Illinois Commerce Commission. The Commission suspended the effective date until April, 1973. On November 27, 1972, the Missouri Public Service Commission entered a schedule of rates applicable to customers of Union in Missouri. In April, 1973, the Illinois Commerce Commission took "administrative notice of rate schedules approved on November 27, 1972, by the Missouri Commission" and made such rates applicable to Union's customers in Illinois.

Union is a utility supplying electrical energy in Missouri, Illinois and Iowa, and is subject to the regulatory authority by a Commission in each state. It provides electric service for some 70,000 Illinois customers. Its customers in Missouri and Iowa were charged rates fixed by the respective Commissions in each state.

The order of the Commission stated that: "Under traditional rate making procedures, this Commission would approve rates and tariffs which would yield an acceptable rate of return on the value of the utilities (Union's) property used and useful in serving Illinois rate payers," but concluded that because of the peculiar circumstances of operation in Missouri and Illinois it was impossible to provide rates which would yield an acceptable rate of return in Illinois because such would require a rate higher than that approved in Missouri.

The Commission concluded that a difference in such rates would constitute discrimination under the provisions of section 38 of "An Act concerning public utilities" (Ill. Rev. Stat. 1973, ch. 111 2/3, par. 38), which provides:

"No public utility shall, as to rates or other charges, services, facilities or in other respect, make or grant any preference or advantage to any corporation or person or subject any corporation or person to any prejudice or disadvantage. No public utility shall establish or maintain any unreasonable difference as to rates or other charges, services, facilities, or in any other respect, either as between localities or as between classes of service."

Union perfected its timely appeal to the circuit court of Jersey County. While the court's determination was pending the Commission entered an order fixing proposed revised rates on October 23, 1974. Upon such superseding rate schedule for Union being brought to the attention of the court, it entered the order now on appeal.

Union urges on appeal, that the Commission refused to find a fair value of its property in Illinois, and failed to determine a reasonable rate of return, and arbitrarily and unlawfully refused to fix rates or tariffs to produce a fair return in Illinois by adopting the schedule of rates ordered by the Missouri Public Service Commission.

The notice of appeal prays that this court reverse the trial court in so far as it affirms the order of the Commission, and that this court remand to the circuit court with directions to remand to the Commission with instructions to ascertain the fair market value of Union's property, to determine a fair rate of return and to fix reasonable rates which would produce such fair return.

• 1 Union urges that this appeal should be treated as an exception to the rule that courts will not pass upon issues in the absence of real controversy. As stated in Kern v. Chicago & Eastern Illinois R.R. Co. (1963), 44 Ill. App.2d 468, 477, 195 N.E.2d 197, 201, cert. denied, 379 U.S. 825, 13 L.Ed.2d 35, 85 S.Ct. 51:

"[M]ootness is a doctrine which the court imposes for its own protection, and it will not applied where it is apparent that the controversy is a genuine one concerning valuable rights and where the party defending maintains that it still has the power to annul those rights and to recreate the condition as it existed at the time the litigation was commenced. * * *"

Kern discusses at length the practice in the Federal courts as to regulatory agencies which enter short term orders that may expire before judicial review may be obtained. Such cases hold that the issue does not become moot by expiration of the order because of the reasonable possibility that the order will be renewed. See Southern Pacific Terminal Co. v. Interstate Commerce Commission (1911), 219 U.S. 498, 55 L.Ed. 310, 31 S.Ct. 279; Southern Pacific Co. v. Interstate Commerce Commission (1911), 219 U.S. 433, 55 L.Ed. 283, 31 S.Ct. 288.

The brief filed in behalf of the Commission clearly indicates that it asserts the right to enter orders as to Union upon the rationale and for the reasons set out in the order on ...


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