Bellsouth Telecommunications v. TN. Regulatory Authority

IN THE COURT OF APPEALS OF TENNESSEE
MIDDLE SECTION AT NASHVILLE

FILED
BELLSOUTH TELECOMMUNICATIONS, INC. )
d/b/a SOUTH CENTRAL BELL TELEPHONE )
COMPANY, )
) November 19, 1997
Petitioner/Appellant, ) Public Service
) Commission
VS. ) No. 95-03383
) Cecil W. Crowson
H. LYNN GREER, Chairman, SARA KYLE, ) Appeal No.
Appellate Court Clerk
Director, and MELVIN J. MALONE, Director, ) 01A01-9601-BC-00008
Constituting the Tennessee Regulatory Authority, )
)
Respondents/Appellees. )

BELLSOUTH TELECOM MUNICATIONS, INC., )
) Public Service
Petitioner, ) Commission
) No. 95-02614
VS. )
) Appeal No.
TENNESSEE PUBLIC SERVICE COMMISSION, ) 01A01-9602-BC-00066
)
Respondent. )

STATE OF TENNESSEE, on relations of )
BELLSOUTH TELECOM MUNICATIONS, INC., )
)
Petitioner/Appellant, ) Davidson Chancery
) No. 95-2965-II
VS. )
)
KEITH BISSELL, STEVE HEW LETT, and ) Appeal No.
SARA KYLE, in their capacity as Commissioners ) 01A01-9601-CH-00016
of the Tennessee Public Service Commission, )
)
Respondents/Appellees. )
 APPEAL FROM
THE TENNESSEE PUBLIC SERVICE COMMISSION
NASHVILLE, TENNESSEE

For BellSouth Telecommunications, Inc.: For Tennessee Public Service Comm.:

Guy M. Hicks, III Charles W. Burson
Bennett L. Ross Attorney General & Reporter
Nashville, Tennessee
Michael E. Moore
James G. Harralson Solicitor General
Atlanta, Georgia
Michael W. Catalano
Associate Solicitor General
Nashville, Tennessee
For AT&T Communications of the
South Central States, Inc.:

Val Sanford For Tennessee Consumers:
John Knox Walkup
Gullett, Sanford, Robinson & Martin Charles W. Burson
Nashville, Tennessee Attorney General & Reporter

Michael E. Moore
Solicitor General

L. Vincent Williams
Consumer Advocate
Nashville, Tennessee

PETITION FOR REHEARING DENIED

WILLIAM C. KOCH, JR., JUDGE
 OPINION ON PETITION FOR REHEARING

BellSouth Telecommunications, Inc. has filed a petition for rehearing that
requests this court to modify its October 1, 1997 opinion to include a holding that
BellSouth’s price regulation plan became effective on March 1, 1996. At our
invitation, the other parties to this appeal have now responded. AT&T
Communications of the South Central States, Inc. asserts that the issues raised by
BellSouth are within the original, primary jurisdiction of the Tennessee Regulatory
Authority. The Tennessee Regulatory Authority asserts that setting March 1, 1996
as the effective date of BellSouth’s price regulation plan is improper because
BellSouth has not been operating under a price regulation plan as a result of our
April 3, 1996 stay order. The Consumer Advocate Division launches an unfocused
fusillade of complaints that our October 1, 1997 opinion “overlooks” or
“misapprehends” prior case law, material facts, and the arguments in the Consumer
Advocate’s earlier briefs.1

Our October 1, 1997 opinion focused on the procedure employed by the
Tennessee Public Service Commission to consider and act on BellSouth’s application
for a price regulation plan. Rather than focusing on the substance or merits of the
Commission’s decision, we held that the procedure the Commission followed did not
comply with Tenn. Code Ann. § 65-5-209. Accordingly, we vacated the
Commission’s orders and remanded the case to its successor for further proceedings
consistent with the requirements of Tenn. Code Ann. § 65-5-209.

We again decline the invitation to review the wisdom of the General
Assembly’s choice of the transition procedure in Tenn. Code Ann. § 65-5-209 over
a “full-blown rate hearing.” The General Assembly has the prerogative, within
constitutional boundaries, to fashion this State’s public policy. See Cary v. Cary, 937

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The Consumer Advocate Division raises many new arguments in its petition for rehearing,
including its assertion that Tenn. Code Ann. § 65-5-209 (Supp. 1997), as interpreted by this Court,
amounts to a taking of private property without due process of law and that this Court has usurped
the powers of the Tennessee Regulatory Authority in violation of Tenn. Const. art. II, §§ 1 & 2. We
will not attempt to run down the threads of each of the Consumer Advocate Division’s arguments
because the Division has not itself filed a petition for rehearing. Instead, we interpret its response
to be that we should deny BellSouth’s petition for rehearing because our October 1, 1997 opinion
is simply wrong.

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S.W.2d 777, 781 (Tenn. 1996). Accordingly, the courts consistently decline to
inquire into legislative motivations, see Memphis Publishing Co. v. City of Memphis,
871 S.W.2d 681, 688 (Tenn. 1994), or into the wisdom of the legislature’s policy
choices. See Neece v. City of Johnson City, 767 S.W.2d 638, 639 (Tenn. 1989); State
v. Southern Fitness & Health, Inc., 743 S.W.2d 160, 164 (Tenn. 1987); Soukup v.
Sell, 171 Tenn. 437, 441, 104 S.W.2d 830, 831 (1937).

The doctrine of separation of powers counsels the courts to avoid requiring an
administrative agency to take a particular action except in the most extraordinary
circumstances. We should decline, for constitutional and practical reasons, to
shoulder an agency’s responsibilities. Thus, the goal of a remand in cases of this sort
should generally be to require the agency to carry out its task in a manner consistent
with its statutory authority. See Hoover, Inc. v. Metropolitan Bd. of Zoning Appeals,
___ S.W.2d ___, ___ (Tenn. Ct. App. 1997).2

Throughout these proceedings, BellSouth consistently asserted that the
procedure followed by the Commission was not authorized by Tenn. Code Ann. § 65-
5-209 and requested the courts to require the regulators to make their decisions in
accordance with Tenn. Code Ann. § 65-5-209. Our October 1, 1997 opinion settles
the dispute concerning what Tenn. Code Ann. § 65-5-209 requires. Now it falls upon
the Tennessee Regulatory Authority to consider BellSouth’s application for a price
regulation plan in accordance with Tenn. Code Ann. § 65-5-209.

Ordering the Authority to grant BellSouth’s application for a price regulation
plan and to declare that this plan has been in effect since March 1, 1996 would invade
the Authority’s jurisdiction and would also be inconsistent with our April 3, 1996
stay order. As a result of our stay, BellSouth has continued to operate under the
former regulatory statutes rather than the new statutes enacted in 1995. Accordingly,
BellSouth has not, as a matter of fact and law, been operating under a price regulation
plan since March 1, 1996. It would be error for us to hold at this juncture that it has.

BellSouth’s petition for rehearing is respectfully denied and the case is
remanded to the Tennessee Regulatory Authority. The costs incident to this petition

2
Hoover, Inc. v. Metropolitan Bd. of Zoning Appeals, App. No. 01A01-9609-CH-00442, 1997
WL 106978, at *3 (Tenn. Ct. App. Mar. 12, 1997), perm. app. denied (Tenn. Oct. 6, 1997).

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are taxed against BellSouth Telecommunications, Inc. and its surety for which
execution, if necessary, may issue.

__________________________
WILLIAM C. KOCH, JR., JUDGE

CONCUR:

_________________________________
SAMUEL L. LEWIS, JUDGE

_________________________________
BEN H. CANTRELL, JUDGE

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