Montana Board of Natural Resources & Conservation v. Montana Power Co.

No. 12889 IN THE SUPREME COURT OF THE STATE O MONTANA F M N A A BOARD OF NATURAL RESOURCES AND CONSERVATION and OTN JOSEPH W. SABOL, Chairman, OWEN E. SOWERWINE, DR. WILSON F. CLARK, DEAN HANSON, RILEY OSTBY, CECIL WEEDXNG and DAVID G. DRUM, a s Members o f t h e BOARD O NATURAL RESOURCES AND F CONSERVATION and t h e M N A A DEPARTMENT OF NAUTRAL RESOURCES OTN AND CONSERVATION and GARY J . WICKS, DIRECTOR O THE M N A A F OTN DEPARTMENT O NATURAL RESOURCES AND CONSERVATION, F P l a i n t i f f s and A p p e l l a n t s , THE M N A A P W R COMPANY, a C o r p o r a t i o n , OTN O E Defendant and Respondent. Appeal from: D i s t r i c t Court of t h e F i r s t J u d i c i a l D i s t r i c t , Honorable P e t e r Meloy, Judge p r e s i d i n g . Counsel of Record: For Appellants : Doney, M a c I n t y r e and C h r o n i s t e r , Helena, Montana Donald D. M a c I n t y r e a r g u e d , H e l e n a , Montana R o b e r t T. Cummins a r g u e d , Helena, Montana F o r Respondent: Thomas K e l l y a r g u e d , B i l l i n g s , Montana W i l l i a m C o l d i r o n appeared and John C a r l a p p e a r e d , B u t t e , Montana Submitted: December 4, 1974 Decided : MR3 1 196 F i l e d : @RR 9 1 1975 M r . J u s t i c e John Conway Harrison d e l i v e r e d t h e Opinion o f t h e Court . T h i s i s an appeal by t h e Montana Board of Natural Resources and Conservation from a judgment of t h e d i s t r i c t c o u r t , Lewis and Clark County. The p r e s i d i n g judge Honorable P e t e r G. Meloy h e l d t h e Montana Power Company exempt from s e c t i o n 70-811 ( 3 ) , R. C.M. 1947. This m a t t e r was f i r s t b e f o r e t h i s Court i n an o r i g i n a l pro- ceeding, Montana Board of N a t u r a l Resources v. The Montana Power Co., 31 St.Rep.930. The Board of N a t u r a l Resources and Conservation ( h e r e i n a f t e r r e f e r r e d t o a s t h e Board) found t h a t t h e Montana Power Company ( h e r e i n a f t e r r e f e r r e d t o a s t h e Power Company) must o b t a i n a c e r t i - f i c a t e under t h e p r o v i s i o n s of t h e Montana U t i l i t y S i t i n g Act of 1973, s e c t i o n s 70-801 through 70-823, R.C.M. 1947, t o c o n s t r u c t a t r a n s m i s s i o n l i n e from B i l l i n g s t o Great Falls,Montana. The Board f i r s t went t o t h e d i s t r i c t c o u r t and o b t a i n e d a temporary r e s t r a i n i n g o r d e r e n j o i n i n g t h e Power Company from c o n s t r u c t i n g t h e l i n e . The t r i a l c o u r t found t h e Power Company had commenced c o n s t r u c t i o n be- f o r e January 1, 1973, and e n t e r e d j u d g m n t f o r t h e Power Company d e c l a r i n g i t exempt from t h e p r o v i s i o n s of s e c t i o n 70-811(3), R.C.M. 1947, and no c e r t i f i c a t e was r e q u i r e d . That r u l i n g was appealed t o t h i s Court a s k i n g t h a t t h e temporary r e s t r a i n i n g o r d e r be r e i n s t a t e d . A f t e r h e a r i n g , t h i s Court denied t h a t request. The Board now a p p e a l s from t h e judgment o f t h e d i s t r i c t c o u r t d e c l a r i n g t h e Power Company exempt from s e c t i o n 70-811(3) and seeks a d e c l a r a t i o n by t h i s Court t h a t a c e r t i f i c a t e of environmental c o m p a t i b i l i t y and p u b l i c need i s r e q u i r e d . The s o l e i s s u e on a p p e a l i s whether t h e B i l l i n g s - G r e a t F a l l s 230 KV u t i l i t y f a c i l i t y was under c o n s t r u c t i o n on January 1, 1973. The Power Company i s engaged i n t h e production and d i s t r i b u t i o n of e l e c t r i c a l energy i n Montana. A t a hearing before t h e t r i a l court i t was e s t a b l i s h e d by u n c o n t r a d i c t e d evidence t h a t f o r much of t h e period of i t s e x i s t e n c e i t has r e l i e d e n t i r e l y upon water power f o r t h e g e n e r a t i o n of i t s e l e c t r i c i t y and only i n r e c e n t y e a r s has t h e Power Company turned t o o t h e r forms of power g e n e r a t i o n . Because of t h e r a p i d i n c r e a s e i n demand f o r e l e c t r i c i t y i n i t s s e r v i c e a r e a i n r e c e n t y e a r s and t h e problems caused by low water and s e v e r e w i n t e r f r e e z i n g t h a t have a r i s e n because of i t s dependence upon water power, t h e Power Company was faced w i t h brown-out c o n d i t i o n s u n l e s s improvements were made. For example: In the Billings service a r e a t h e r e was a 69% i n c r e a s e i n demand from 1969 t o 1972; i n t h e Great F a l l s s e r v i c e a r e a a 43% i n c r e a s e ; and i n t h e Butte-Helena s e r v i c e a r e a a 19% i n c r e a s e . I t was obvious i n t h e l a t e 1960s t h a t t h e demands of t h e Power Company's customers were s t r a i n i n g t h e c a p a c i t y of i t s e x i s t i n g t r a n s m i s s i o n l i n e s and t h a t t h e f u t u r e demands would be g r e a t e r than t h e Company could handle on i t s e x i s t - ing l i n e s . To meet t h i s i n c r e a s i n g demand, t h e Power Company began b u i l d i n g a 230 KV t r a n s m i s s i o n l i n e loop, which when f i n i s h e d would e n c i r c l e B u t t e , Anaconda, Helena, Great F a l l s and B i l l i n g s and towns s e r - viced w i t h i n t h a t loop. I n a d d i t i o n , t h e Power Company b u i l t a steam production p l a n t i n B i l l i n g s and i s i n t h e process of completing two energy production p l a n t s i n C o l s t r i p , Montana, which a r e due t o go i n t o production i n t h e y e a r s 1975 and 1976. One of t h e p r i n c i p a l reasons f o r t h e c o n s t r u c t i o n of t h e loop i s t o be a b l e t o r a p i d l y t r a n s f e r energy t o where i t i s needed and thus have a c o n s t a n t a v a i l a b l e source r e g a r d l e s s of weather o r o t h e r f a c t o r s . A s a f i n a l p a r t of t h e completion of t h e loop, t h e Power Company i n 1968-69 c o n s t r u c t e d 18 s t e e l towers (about t h r e e m i l e s ) , running n o r t h from t h e C o r e t t e Generating P l a n t i n B i l l i n g s t o t h e v i c i n i t y o f A l k a l i Creek. Tower No. 18 was t o s e r v e a s a j u n c t i o n t o t h e l i n e going n o r t h t o Great F a l l s and t h e l i n e going west t o Butte- Anaconda. From tower No. 18 t o Great F a l l s i t i s approximately 180 m i l e s and s i n c e t h e completion of tower No. 18 i n 1969 t h e Power Company has acquired some 117 m i l e s of right-of-way and i s involved i n , o r has completed, s e v e r a l condemnation a c t i o n s f o r t h e remainder. I n a d d i t i o n , a number of a d m i n i s t r a t i v e m a t t e r s have occurred concerning t h e l i n e . Cost e s t i m a t e s have been made f o r budgetary purposes; some of t h e wooden p o l e s , known a s "H S t r u c t u r e s " , h a v e been ordered and many have been d e l i v e r e d t o s p e c i f i e d s i t e s ; i n s u l a t o r s have been ordered and d e l i v e r e d ; an e n g i n e e r i n g f i r m , r e f e r r e d t o a s MAIN-STR was h i r e d and has made an environmental impact s t u d y of t h e a r e a between Great F a l l s and B i l l i n g s and h a s made a r e p o r t on a p r e f e r r e d r o u t e ; and, c o n t r a c t s were l e t i n e a r l y 1974 t o t h e Montana Line C o n t r a c t o r s A s s o c i a t i o n f o r t h e sum of $1,600,000 t o f i n i s h t h e l i n e , I n 1973, t h e 43rd l e g i s l a t u r e passed what i s known a s t h e Montana' U t i l i t y S i t i n g Act, e f f e c t i v e March 1 6 , 1973, t o b e adminis- t e r e d by t h e Board. S h o r t l y a f t e r t h e passage of t h e Act o f f i c i a l s of t h e Power Company met w i t h t h e Board t o d i s c u s s how t h e Act would a f f e c t a number of i t s p r o j e c t s and t o a l s o g i v e t h e Board a long range c o n s t r u c t i o n plan of t h e Power Company. A t t h i s meeting, h e l d March 1 6 , 1973, t h e Power Company gave t h e Board a memorandum which purported t o s p e c i f y t h e p r o j e c t s t h a t i t had under c o n s t r u c - t i o n and t h o s e t h a t i t i n t m d d t o apply f o r c e r t i f i c a t e s f o r , under t h e new Act. The B i l l i n g s - G r e a t F a l l s 230 KV l i n e was n o t l i s t e d a s under c o n s t r u c t i o n b u t was l i s t e d a s a p r o j e c t f o r which a c e r t i f i c a t e would be a p p l i e d f o r . O May 11, 1973, t h e Power Company a p p l i e d n f o r such a c e r t i f i c a t e and paid an a p p l i c a t i o n f e e of $90,250 a s an e s t i m a t e on t h e t o t a l c o s t of $7,025,000. The c o s t t o b u i l d t h e 18 towers, a sum of $300,000, was n o t included. As a r e s u l t of t h e f i l i n g f o r t h e c e r t i f i c a t e t h e Board began i t s environmental s t u d i e s , b u t a s of t h e time of t h e f i l i n g of t h i s cause t h e c e r t i - f i c a t e had n e i t h e r been g r a n t e d nor denied. Approximately one y e a r a f t e r f i l i n g i t s a p p l i c a t i o n f o r a c e r t i f i c a t e t h e Power Company determined t h e B i l l i n g s - G r e a t F a l l s l i n e c e r t i f i c a t e should n o t have been r e q u e s t e d due t o t h e f a c t t h a t under t h e S i t i n g Act t h a t l i n e was under c o n s t r u c t i o n p r i o r t o January 1, 1973. The Board argues t h e Power Company i s estopped, even though t h e p r o j e c t was under c o n s t r u c t i o n p r i o r t o January 1, 1973, by reason of having r e p r e s e n t e d t o t h e Board t h a t t h e l i n e was n o t under c o n s t r u c t i o n a s of January 1, 1973, and t h e r e f o r e , having a p p l i e d and paid t h e f e e f o r a c e r t i f i c a t e , t h e Board i n r e l i a n c e upon t h a t r e p r e s e n t a t i o n by t h e Power Company a c t e d t o i t s d e t r i m e n t . The Board f u r t h e r argues t h i s Court should i n t e r p r e t s e c t i o n s 70-804 and 70-811(3), R.C.M. 1947, t o r e q u i r e a c e r t i f i c a t e f o r t h e Great F a l l s - B i l l i n g s f a c i l i t y . The two s e c t i o n s of t h e S i t i n g Act involved provide i n per- tinent part : "70-804, R.C.M. 1947. N person s h a l l commence t o o c o n s t r u c t a u t i l i t y f a c i l i t y i n t h e s t a t e without f i r s t having o b t a i n e d a c e r t i f i c a t e i s s u e d w i t h r e s p e c t t o such f a c i l i t y by t h e board. ** A-" "70-811 ( 3 ) , R. C.M. 1947. ** A c e r t i f i c a t e i s not r e q u i r e d under t h i s a c t f o r f a c i l i t i e s under c o n s t r u c - t i o n o r i n o p e r a t i o n on January 1, 1973. However, a c e r t i f i c a t e must be obtained f o r a s s o c i a t e d f a c i l i t i e s upon which c o n s t r u c t i o n has n o t commenced b e f o r e January 1, 1973 ** *.If Before d i s c u s s i n g t h e two s t a t u t e s we n o t e t h a t p r i o r t o t h i s t h r e e d i s t r i c t judges have r e j e c t e d t h e i n t e r p r e t a t i o n urged by t h e Board. Our t a s k i s t o c o n s t r u e what t h e l e g i s l a t u r e intended by t h e words " f a c i l i t i e s under c o n s t r u c t i o n *** on January 1, 1973" a s t h e y appear i n s e c t i o n 70-811(3), R.C.M. 1947. This Court has long e s t a b l i s h e d s e t r u l e s of c o n s t r u c t i o n t o be followed i n a s c e r t a i n i n g and i n t e r p r e t i n g l e g i s l a t i v e purpose and i n t e n t . I n 1921, i n Wilkinson v. La Combe, 59 Mont. 518, 522, 197 P. 836, t h i s Court h e l d : "Of two a d m i s s i b l e c o n s t r u c t i o n s , t h e c o u r t s a r e never j u s t i f i e d i n a d o p t i n g t h e one which d e f e a t s t h e manifest o b j e c t of t h e s t a t u t e involved ik * *." I n 1948, i n S t a t e Board of E q u a l i z a t i o n v. Cole, 122 Mont. 9 , 20, 195 P.2d 989, t h e Court s a i d : " S t a t u t e s 'should b e s o construed a s t o g i v e a s e n s i b l e a n d i n t e l l i g e n t meaning t o every p a r t and a v o i d absurd and unjust consequences. S e c t i o n 516, ~ e w i s 'Sutherland Stat.Const.(Zd ~ d . ) ' S t a t e v. Redmond, 73 Mont. 376, 380, 237 Pac. 486, 488." I n r e 3 s t a t e a f Aarans, 143 idont. 388, 395, 390 P.2d 443 ( L 3 6 4 ) , t h e Court s a i d : It* * c I n s h o r t , we do n o t impute t o t h e l e g i s l a t u r e ; t h e i n t e n t t o g i v e and t a k e away i n one s t a t u t o r y pronouncement . 'ice ~ X s o : Helena V a l l e y I r r i g a t i o n D i s t r i c t v. S t a t e Highway Comm'n, L j O Mont. 1 9 2 , 433 P.2d 791 (1967); S t a t e v. Holmes, 114 Mont. 372, 3 1 6 , 136 P.2d 220 (1943). 11 The v e r y r e a d i n g o f s e c t i o n 70-811(3), A c e r t i f i c a t e is not required under t h e a c t f o r f a c i l i t i e s under c o n s t r u c t i o n o r i n a p e r a t i o n on J a n u a r y 1, 1973." i n d i c a t e s t h e l e g i s l a t u r e was aware c h a t on some c o n s t r u c t i o n p r o j e c t s work was underway and t h i s work begun b e f o r e J a n u a r y 1 , * 1 9 7 3 w a s t o b e e x c l u d e d o r exempt. Here, t h e r e i s no d i s p u t e t h a t work had been done i n 1968 on t h e h e g i n n i n g o f t h e B i l l i n g s - G r e a t F a l l s l i n e ; 18 towers were b u i l t from t h e p o i n t o f power g e n e r a t i o n t o a p o i n t some 3 m i l e s t o t h e north. I n 1969, t h e s t e e l s t a t i c w i r e , a p a r t of t h e l i n e , was laced on t h e 18 t o w e r s . O t h e r a c t s f o l l o w e d which a r e c o n s i d e r e d 11 c o n s t r u ~ t i o n ~ ~ a s t h e ordering of t h e H poles, a very special such i t e m t h a t t a k e s c o n s i d e r a b l e t i m e t o o b t a i n and which comes from s e v e r a l r a t h e r t h a n one b i d d e r ; t h e s t o c k p i l i n g o f t h e p o l e s n e a r the construction s i t e s ; t h e b u d g e t i n g f o r and o b t a i n i n g o f w i r e ; t h e p u r c h a s e of much of t h e r i g h t - o f - w a y ; and, t h e l e t t i n g of t h e 3nvironmental study c o n t r a c t . While t h e o b t a i n i n g o f "right-of-way1' by condemnation a c t i o n was ~ i o ta f a c t o r t o b e c o n s i d e r e d i n d e t e r m i n i n g t h e " f a c i l i t i e s under c o n s t r u c t i o n " i t i s o f i n t e r e s t t h a t t h e 1974 l e g i s l a t u r e amended s e c t i o n 70-803, R.C.M. 1947, t o i n c l u d e a d e f i n i t i o n o f If i-he p h r a s e commence t o c o n s t r u c t " . Subsection ( 5 ) ( a ) of t h a t jection provides: IIany c l e a r i n g o f l a n d , e x c a v a t i o n , c o n s t r u c t i o n , o r o t h e r a c t i o n t h a t would a f f e c t t h e environment o f t h e s i t e o r c o u t e of a u t i l i t y f a c i l i t y , b u t do n o t i n c l u d e changes needed f o r temporary u s e o f s i t e s o r r o u t e s f o r n o n u t i l i t y , ~ u r p o s e s ,o r u s e s i n s e c u r i n g g e o l o g i c a l d a t a , i n c l u d i n g - n e c e s s a r v b o r i n g s t o a s c e r t a i n f o u n d a t i o n c o n d i t i o n s . The words do i n c l u d e t h e commencement of eminent domain pro- z e e d i n g s under T i t l e 9 3 , c h a p t e r 99, R.C.M. 1 9 4 / , f o r l a n d o r r i g h t s of way upon which a u t i l i t y f a c i l i t y may b e con- ; t r u c t e d . " (Emphasis s u p p l i e d ) . The Board argues t h a t t h e word " c o n s t r u c t i o n " i s n o t d e f i n e d i n t h e Act a s passed, t h e r e f o r e , t h e Court must look t o t h e r e s t r i c - t i o n s placed on t h e word o r phrase t o a s c e r t a i n t h e i n t e n t of t h e O l e g i s l a t u r e a s the t h e word "construction". F u r t h e r , t h a t we must I/ c a r e f u l l y look t o modifying words and t h e g e n e r a l l e g i s l a t i v e s e t t i n g i n which t h e word and t h e modifying words appear. It f u r t h e r argues t h a t t h e phrasing of s e c t i o n 70-811(3), R.C.M. 1947, i s narrow and r e s t r i c t i v e , t h a t i s , t h a t t h e f a c i l i t y must be under c o n s t r u c t i o n on January 1, 1973. The Board f u r t h e r a r g u e s t h a t a l l t h e condemnation a c t i o n s f i l e d by t h e Power Company were i n s t i t u t e d p r i o r t o t h e 1974 amendment t o s e c t i o n 70-$03 and i t i s n o t a p p l i c a b l e h e r e ; and t h a t we must look t o t h e law a s i t stood a t t h e time t h e eminent domain proceedings were i n s t i t u t e d . W agree. e Here, land was c l e a r e d , excavation and c o n s t r u c t i o n of t h e 18 towers a f f e c t i n g t h e environment of t h e s i t e and r o u t e had begun. W f i n d t h e r e was a commencement of c o n s t r u c t i o n p r i o r t o e January 1, 1973. W do n o t f i n d , a s t h e Board a r g u e s , t h a t t h e f i l i n g of t h e e a p p l i c a t i o n and paying t h e $90,250 f i l i n g f e e p u t s t h e Power Company i n such an i n c o n s i s t e n t p o s i t i o n a s t o b r i n g t h e c a s e w i t h i n t h e doctrine of equitable estoppel. I n e f f e c t , what t h e Board argues i s t h a t f a i l u r e of t h e Power Company t o l i s t t h e B i l l i n g s - G r e a t F a l l s l i n e a s one under c o n s t r u c t i o n and i n r e q u e s t i n g a c e r t i f i c a t e , t h e Power company's l a t e r p o s i t i o n t h a t t h e p r o j e c t was under c o n s t r u c t i o n gave j u r i s d i c t i o n t o t h e Board t o a c t . Not so! Juris- d i c t i o n cannot be a c q u i r e d by e s t o p p e l . 73 C.J.S., P u b l i c Adminis- t r a t i v e Bodies and Procedure 5 116, p. 435: "A p u b l i c a d m i n i s t r a t i v e body has such a d j u d i c a t o r y j u r i s d i c t i o n a s i s c o n f e r r e d on i t by s t a t u t e . I t may n o t a c q u i r e j u r i s d i c t i o n by e s t o p p e l o r c o n s e n t , and, where i t a c t s w i t h o u t j u r i s d i c t i o n , i t s o r d e r s a r e void. 9 9 +c" : : See: 2 Am J u r 2d A d m i n i s t r a t i v e Law, 5 331, p. 152; Grubb v. Public U t i l i t i e s Commission of Ohio, 50 Sup.Ct. 374, 281 U.S. (, - $ 7 0 , 74 L ed. 9 7 2 ; ~ ~ r i n g f - i e k d tommunity School D i s t . v . Lowa 3 e p t . of Pub. I n s t . , 252 Iowa 907, 109 N.W.2d 213; Rosenberry v. i i l l a n Bros., 130 Pa.Super. 469, 197 A. 523. The judgment of t h e d i s t r i c t c o u r t i s a f f i r m e d . C I Justice. W Concur: e Chief J u s t i c e