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06/10/87 Citizens Utilities Company v. the Illinois Commerce

June 10, 1987





510 N.E.2d 52, 157 Ill. App. 3d 201, 109 Ill. Dec. 431 1987.IL.782

Appeal from the Circuit Court of Cook County; the Hon. David Shields, Judge, presiding.


PRESIDING JUSTICE McNAMARA delivered the opinion of the court. RIZZI and FREEMAN, JJ., concur.


Respondent Citizens Utilities Company appeals from orders of the Illinois Commerce Commission which direct respondent to cease charging petitioner National Boulevard Bank unjust rates and to refund all charges paid by petitioner to respondent, plus interest.

Respondent contends that the Commission failed to consider evidence as to whether respondent was offering services to petitioner and that the Commission erred in finding that respondent did not provide sewer service to petitioner. Respondent contends further that section 72 of the Public Utilities Act (Ill. Rev. Stat. 1983, ch. 111 2/3, par. 76) is the exclusive remedy for refunding rates paid, and thus the Commission had no authority to award refunds under sections 32 and 64 of the Act (Ill. Rev. Stat. 1983, ch. 111 2/3, pars. 32, 68) and that the section 72 time and interest rate restrictions apply. Respondent also contends that the Commission erred in not allowing respondent to pay the refund by means of a rate surcharge to its sewer customers and that the trial court had no jurisdiction to enter an enforcement order.

Respondent is a public utility engaged in furnishing water and sanitary sewer services in certain areas of Northern Illinois. In January 1975, petitioner became the owner as trustee of an apartment complex within respondent's service territory. In October 1975, petitioner filed a complaint with the Commission against respondent, designated docket number 60089, regarding the ownership of certain sewer lines and a rebate for sewer charges and late fees paid to respondent. On July 28, 1976, the Commission ordered a rebate of late payment charges, but found it did not have jurisdiction to determine the other issues. Consequently, a declaratory judgment action was filed in the circuit court. The trial court held that respondent owned the sewer mains. This court reversed and entered judgment for the petitioner after finding that the sewer mains were not owned by respondent and that respondent had in fact provided no sewer services to petitioner. (National Boulevard Bank v. Citizens Utilities Co. (1982), 107 Ill. App. 3d 992, 438 N.E.2d 471.) The extensive facts reported in that decision will not be repeated here.

In June 1983, petitioner filed a petition to reopen proofs in case No. 60089. On January 4, 1984, the Commission granted the petition, made certain findings of fact, and concluded that respondent had violated section 32 of the Act and must pay a refund to petitioner. The Commission ordered that further evidence was to be taken on the amount of charges to be refunded, whether interest could be charged on the refund, and whether threats to terminate water service in order to enforce payment of the sewer charges violated the Act.

On August 8, 1984, the Commission filed its second order, which adopted the decision and findings of fact made in its January 4, 1984, order. It found further that the evidence showed that the principal amount paid by petitioner to respondent for sewer service between 1975 and June 1982 was $214,211.02. Evidence received included computations using the average annual prime rate of petitioner bank commencing in 1976. The Commission concluded that 10% should be used as the annual interest rate. It ordered respondent to pay $119,173.05 in interest. The Commission subsequently denied respondent's petition for reconsideration. On September 16, 1986, the trial court upheld the Commission's orders in all respects. The trial court also granted petitioner's motion to enforce the August 8, 1984 order.

Initially we note that orders of the Commission are presumed valid and will be set aside on review only if the findings are manifestly against the weight of the evidence or the order is directly contrary to established rules of law. (Village of Maywood v. Illinois Commerce Com. (1961), 23 Ill. 2d 447, 178 N.E.2d 345, cert. denied (1962), 369 U.S. 851, 8 L. Ed. 2d 10, 82 S. Ct. 935; City of Hurst v. Illinois Commerce Com. (1983), 120 Ill. App. 3d 354, 458 N.E.2d 568.) An order of the Commission is held to be prima facie reasonable, and the burden of proof upon all issues is on the party appealing from the order. Ill. Rev. Stat. 1985, ch. 111 2/3, par. 10-201(d).

A court reviewing a Commerce Commission order is limited to a determination of whether the Commission acted within the scope of its authority, made findings to support its decision, made findings and a decision which have a substantial foundation in the evidence, and did not infringe on constitutional rights. (Illinois Commerce Com. v. New York Central R.R. Co. (1947), 398 Ill. 11, 75 N.E.2d 411; Brink's, Inc. v. Illinois Commerce Com. (1981), 103 Ill. App. 3d 851, 431 N.E.2d 1242.) Respondent maintains that the decision must be affirmed or set aside as a whole. (See Boles Trucking, Inc. v. O'Connor (1985), 138 Ill. App. 3d 764, 486 N.E.2d 362; N-Ren Corp. v. Illinois Commerce Com. (1981), 98 Ill. App. 3d 1076, 423 N.E.2d 1386.) As of January 1, 1986, however, the reviewing courts now have the power to affirm or reverse a Commission order in whole or in part and to remand with such instructions as may be proper. Ill. Rev. Stat. 1985, ch. 111 2/3, par. 10-201(e).

Respondent contends that the Commission erred in refusing to consider evidence of whether respondent actually provided sewer service to petitioner and that the evidence shows respondent did in fact provide sewer service. Respondent argues that the Commission erroneously relied on dicta in National Boulevard Bank v. Citizens Utilities Co. Respondent maintains that the only issue in National Boulevard Bank was whether or not respondent owned the sewer mains and that any language regarding sewerage service was dicta.

Respondent misreads National Boulevard Bank. Our resolution of the ownership issue rested in part on whether or not respondent provided sewer service. An easement transferred the sewer lines only if used by the utility in rendering service. The issue of service was relevant, material, and inextricably bound together with the issue of ownership and therefore was necessary to our decision. We expressly held: "There was, however, no evidence that the company had rendered any sewerage service and thus had used the mains for that purpose. . . . [It] is apparent from the record that while defendant collected sewer charges for 10 years, it in fact rendered no service." (National Boulevard Bank v. Citizens Utilities Co. (1982), 107 Ill. App. 3d 992, 1005, 438 N.E.2d 471.) Thus, the language was not dicta, as respondent argues, and under the ...

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