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LOS ANGELES METROPOLITAN TRANSIT AUTHORITY, Petitioner, v. PUBLIC UTILITIES COMMISSION of the State of California, Respondent.*
The Los Angeles Metropolitan Transit Authority (referred to hereafter as Authority) seeks the annulment of an order of the Public Utilities Commission granting a certificate of public convenience and necessity to Charter Bus Transportation Company (referred to hereafter as Charter).
Charter's operations include seasonal passenger stage services to the Santa Anita, Hollywood Park, and Los Alamitos racetracks, all of which are located in the vicinity of Los Angeles. On April 18, 1958, Charter applied to the Commission for a certificate to engage in passenger stage service to and from the site of the home games of the Los Angeles Dodgers Baseball Club. Specifically, it requested authority ‘to operate bus service during the baseball season between Los Angeles, Huntington Park, Lakewood, Bellflower, Downey, Culver City, Inglewood, La Crescenta, Montrose, Glendale, San Fernando, Torrance, Gardena, Compton, Lynwood, South Gate, Burbank, Beverly Hills, and Santa Monica, California and the Los Angeles Coliseum, Los Angeles, California, (and any other place or places wherein said professional games may be played in the future) with pickups at certain hereinafter designated intermediate points.’
The proposed service would be confined to those wishing transportation to and from the baseball games. The routes the busses were to follow were shown at the hearing to overlap and parallel existing routes of the Authority and of protesting transit lines. Passenger pickups were to be made from specified stops along the various routes from the foregoing cities. Only round-trip service was to be provided. The proposed fares, ranging from $1.20 to.$2.80, entitled the passengers to transportation to the ball grounds before the beginning of the game and to return transportation to the original point of pickup on the same bus at the end of the games to be played that day. The various protestants, particularly the Authority, conduct regularly scheduled operations throughout the area to be served by Charter, but none presently provide the proposed type of direct, round-trip service.
Protests were filed by the Authority, Tanner Motor Tours, Ltd., Santa Monica Municipal Bus Lines, Inglewood City Lines, Culver City Municipal Bus Lines, the City of Gardena, and the City of Torrance. Public hearings were held before a Commission hearing officer on May 2, May 20, and June 4, 1958. On August 5, 1958, the Commission filed its opinion and order authorizing the passenger stage operation requested by Charter except for minor modifications not here involved.
The Authority contends that the Los Angeles Metropolitan Transit Authority Act of 1957, West's Ann.Public Utilities Code Appendix, s 1.1 et seq. (referred to hereafter as the 1957 Act) precludes the Public Utilities Commission from authorizing new passenger stage operations in Los Angeles County. The Public Utilities Commission contends that the 1957 Act does not preclude the Commission from authorizing such operations and that if it did, it would be unconstitutional.
If the Commission retained jurisdiction to issue certificates of public convenience and necessity for passenger stage service in Los Angeles County after the enactment of the 1957 Act, the question whether the differences between the proposed service and the existing service justified the issuance of a certificate of convenience and necessity would be a matter for the expert judgment and discretion of the Commission and we would therefore affirm its order. Pub.Util.Code, s 1757; California Portland Cement Co. v. Public Utilities Commission, 49 Cal.2d 171, 176, 315 P.2d 709; San Diego & Coronado Ferry Co. v. Railroad Commission, 210 Cal. 504, 508-511, 292 P. 640.
The two crucial questions in this case therefore are: (1) Does the 1957 Act preclude the Commission from authorizing new passenger state operation in Los Angeles County? (2) Does the Legislature have the power to so limit the jurisdiction of the Commission?
The original Los Angeles Metropolitan Transit Authority Act was enacted in 1951 to alleviate the transit problems of Los Angeles County. Stats.1951, ch. 1668, p. 3804.1 This legislation proved to be inadequate.
The 1957 Act gives the Authority greatly increased powers to establish an integrated mass rapid transit2 system in Los Angeles County. The Authority may operate the system3 itself,4 may jointly5 use facilities owned by itself or by existing transit systems, and may contract with existing corporations for the superintendence6 of the Authority's system. It is given broad powers to acquire and dispose of property.7 When its economic engineering studies show that it would not be feasible for it to operate transit facilities in a particular area, it may propose and support a special tax-supported transit district in that area.8
The 1951 Act gave the Authority some of the foregoing powers, but expressly provided that it could exercise its powers only under the regulatory control of the Public Utilities Commission.9 The Authority's routes10 and rates,11 and contracts12 were also subject to control by the Public Utilities Commission. Under the 1957 Act the Commission has no control over the Authority with respect to any of these matters. In the absence of legislation otherwise providing, the Commission's jurisdiction to regulate public utilities extends only to the regulation of privately owned utilities. City of San Bernardino v. Railroad Commission, 190 Cal. 562, 213 P. 980; Civic Center Ass'n of Los Angeles v. Railroad Commission, 175 Cal. 441, 445, 166 P. 351; Colman v. Montebello, 24 C.R.C. 930, 931.
There can be no doubt that the 1957 Act contemplates a single integrated system of public transportation in Los Angeles County, operated by the Authority. The legislative policy that prompted the adoption of the 1957 Act is stated in section 1.1 as follows: ‘It is hereby declared to be the policy of the State of California to develop mass rapid transit systems in the various metropolitan areas within the State for the benefit of the people. A necessity exists within Los Angeles County * * * for such a system. Because of the numerous separate municipal corporations and unincorporated populated areas in the * * * (County), only a specially created authority can operate effectively in said metropolitan area. Because of the unique problem presented by that metropolitan area and the facts and circumstances relative to the establishment of a mass rapid transit system therein, the adoption of a special act and the creation of a special authority is required.’ (Italics added.)
By its findings in this section that a necessity exists in Los Angeles County for a mass rapid transit system and that only a specially created authority can operate effectively in that area, the Legislature plainly states its objective to establish a single mass transportation system in Los Angeles County operated by a special authority. In these findings the Legislature has already determined what mass transportation service ‘public convenience and necessity’ require in Los Angeles County. When, despite this legislative determination, the Public Utilities Commission determines that ‘public convenience and necessity’ require that service shall not be limited to ‘only a specially created authority’ but require a service competitive to that of the special authority created by the Legislature, it not only repudiates the Legislature's determination of what public convenience and necessity require but defeats the Legislature's purpose to establish a single mass transportation system in that county operated by its specially created authority.
There is no merit in the Commission's contention that it was not the legislative purpose to integrate into a single system all mass transportation systems in the Los Angeles area but only to integrate the publicly operated transportation systems. The sentence of section 1.1 invoked by the Commission, ‘Because of the numerous separate municipal corporations and unincorporated populated areas in the metropolitan area * * * only a specially created authority can operate effectively in said metropolitan area’ does not refer to transportation systems, either public or private, but to agencies exercising governmental authority. The obvious purport of the sentence is that owing to the number and the limited authority of such agencies, only a public agency with overriding powers can attain an integrated mass transportation system. Any doubt that the Act did not include the integration of private as well as public transportation systems is dispelled by other sections of the Act. Thus section 4.21 provides: ‘One of the purposes of this act is to coordinate any operations of the authority with the operations of any then existing system. * * *’ (Italics added.) Section 3.6(e) requires the authority to observe existing labor contracts ‘whenever the authority acquires existing facilities from a publicly or privately owned public utility.’ (Italics added.) Section 4.22 authorizes the Authority to pay accrued taxes of any existing privately owned system acquired by the Authority.
The only publicly operated public transportation systems in Los Angeles County when the act was passed were the comparatively small systems operated by the cities of Torrance, Santa Monica, Gardena and Montebello. The integration of four small publicly owned systems in separate sections of the county would not carry out ‘the policy of the State of California to develop mass rapid transit systems in the various metropolitan areas.’ When the act was passed all of the major local transportation companies of Los Angeles County were privately owned, including the Los Angeles Transit Lines and Metropolitan Coach Lines, the two major transportation systems, which were united on March 3, 1958, to form the system now operated by the Authority.
The only exception to the legislative policy that ‘only a specially created authority can operate effectively in said metropolitan area’ is stated in section 4.21 of the Act, which provides for the continuance of the existing privately owned public transportation systems, until the Authority purchases such systems under the procedures set forth therein. Section 4.21 contemplates the issuance by the Authority of revenue bonds to finance the acquisition of privately owned systems. Under section 5.4 these bonds are obligations of the Authority only and must contain on their face a recital that neither principal nor interest constitutes an obligation of any county or city of the state. All privately owned systems in existence when the Authority was created are fully protected by section 4.21 which speaks of coordinating the operations of the Authority with the operation of any ‘existing system.’ Neither that section nor any other contemplates that new services may be commenced by a private carrier and then purchased by the Authority. The integration into a single system of all mass transportation in Los Angeles County contemplated by the Legislature could never be accomplished if new services were constantly added, and even if it were once accomplished the process of integration would have to commence all over as new services were authorized by the Commission. The Commission contends, however, that under section 1031 of the Public Utilities Code it retains jurisdiction to authorize passenger stage operations in Los Angeles County, and that if the Legislature meant to limit its jurisdiction thereunder it would have done so expressly as it did in other instances in which it expressly provided that the Commission should not have jurisdiction.13 Section 1031 provides, ‘No passenger stage corporation shall operate or cause to be operated any passenger stage over over any public highway in this State without first having obtained from the commission a certificate declaring that public convenience and necessity require such operation. * * *’ This section would still preclude a privately owned stage corporation from operating a passenger stage over any public highway without obtaining a certificate of public convenience and necessity from the Commission, but it does not authorize such a certificate when public convenience and necessity do not require such operation. In the 1957 Act the Legislature has determined what public convenience and necessity require with respect to passenger stage operations in Los Angeles County. This legislative determination of public convenience and necessity precludes an inconsistent determination by the Commission. Thus the integrity of both the 1957 Act and section 1031 of the Public Utilities Code are maintained. The latter controls all passenger stage operations in the state except those in Los Angeles County, with respect to which the Legislature has determined that public convenience and necessity require a single integrated transportation system operated by a special authority.
The Commission contends, however, that section 1031 of the Public Utilities Code, empowering it to certify passenger stage operations, controls anything in the 1957 Act, on the ground that the Public Utilities Act ‘is the supreme state law, even paramount to the state Constitution.’ Sections 22 and 23 of the California Constitution, Article 12, however, provide that nothing in the Constitution shall limit the power of the Legislature to confer powers on the Commission. In that sense only is the Public Utilities Act ‘the supreme state law.’ See Pacific Tel. & Tel. Co. v. Eshleman, 166 Cal. 640, 658, 137 P. 1119, 50 L.R.A.,N.S., 652.
The Commission's powers to certify passenger stage operations are derived entirely from the Legislature under section 23 of Article XII of the California Constitution.14 That section provides: ‘Every private corporation * * * owning, operating, managing, or controlling any commercial railroad, interurban railroad, street railroad * * * and every common carrier, is hereby declared to be a public utility subject to such control and regulation by the * * * Commission as may be provided by the Legislature. * * * The * * * Commission shall have and exercise such power and jurisdiction to supervise and regulate public utilities, in the State of California, and to fix rates to be charged for commodities furnished, or services rendered by public utilities as shall be conferred upon it by the Legislature, and the right of the Legislature to confer powers upon the * * * Commission respecting public utilities is hereby declared to be plenary and to be unlimited by any provision of this Constitution.’ (Italics added.)
In view of the plain language of this section it cannot reasonably be contended that the Legislature does not have the same power to modify or withdraw as it has to add to any jurisdiction previously conferred on the Commission. Had the Constitution vested jurisdiction in the Commission to grant certificates of public convenience and necessity, the Legislature, of course, could not ‘modify, curtail, or abridge’ that jurisdiction (People v. Western Air Lines, Inc., 42 Cal.2d 621, 637, 268 P.2d 723, 724). Since the Commission's jurisdiction to grant such certificates is derived entirely from the Legislature, that body has plenary power to modify, curtail or abridge that jurisdiction. Cal.Const. Art. XII, s 23.
The order is annulled.
FOOTNOTES
1. Rapid transit was defined by that act (section 2.7) as: ‘* * * (T) ransportation of passengers, mail and hand baggage * * * by means of suspended overhead monorail on routes which the California Public Utilities Commission has first determined are required by public convenience and necessity, together with any supplemental feeder bus lines which established common carriers of passengers serving the area decline to provide after that commission has determined they are required by public convenience and necessity.’
2. Mass rapid transit, as defined in section 2.7, is ‘* * * (T)ransportation of passengers, mail and hand baggage by means of motor bus, trolley coach, street railway, rail, suspended overhead rail, elevated railway, subway, or any other surface, overhead or underground transportation or any combination thereof.’
3. ‘s 2.8. ‘System’ means all real and personal property of every kind and nature whatsoever owned or held at any time by the authority for mass rapid transit * * *.'
4. ‘s 4.8. * * * The authority may operate motor bus lines, and motor busses upon any public streets, highways, ways or freeways, and, subject to the requirements of the last preceding sentence with respect to new structures, may operate any other method of mass rapid transit in, upon, over, under or across public streets, highways, freeways and other public places.’
5. ‘s 4.5. The authority shall have power to enter into agreements for the joint use of any property and rights by the authority and any public utility operating any transportation facilities; to enter into agreements with any public utility operating any transportation facilities either within or without the metropolitan area for the joint use of any property of the authority or public utility, or the establishment of through routes, joint fares and transfer of passengers.’
6. Section 3.6(b) ‘The authority may to the extent permitted by the Constitution of the State of California, make a contract for superintendence with any corporation (sometimes in this act referred to as the superintending corporation) which has executive personnel with experience and skill applicable to the superintendence of the operation and maintenance of any part of the system for the furnishing of its services and the services of experienced and qualified personnel for the superintendence of the operation and maintenance of the system or any part thereof * * *. Neither such contract, nor the corporation which is a party thereto with respect to its rights and duties thereunder, shall be subject to control or regulation by the Public Utilities Commission or by any political subdivision of the State of California other than by the authority as provided in such contract.’
7. ‘s 4.3. The authority may acquire by grant, purchase, gift, devise or lease, and may hold, use, sell, lease or dispose of, real and personal property of every kind and nature whatsoever, licenses, patents, rights and interests necessary for the full exercise, or convenient or useful for the carrying on of, any of its powers pursuant to the provisions of this act.‘s 4.4. The authority shall have power to acquire, construct, complete, develop, own, operate and maintain the system; including power to acquire by purchase, lease, gift or otherwise all or any part of any patents, licenses, rights, interests, engineering studies, data or reports owned or held by any person and determined by the authority to be necessary, convenient or useful to the authority in connection with the acquisition, construction, completion, development, ownership, operation or maintenance of the system. * * *‘s 4.6. The authority may exercise the right of eminent domain for the condemnation of real or personal property or any right or interest therein for its use within the metropolitan area, including the power to acquire real property in fee simple or any lesser estate or interest for rights of way or other uses of the authority * * *. Sections 1401 to 1421, inclusive, of the Public Utilities Code shall not apply to any such condemnation of property of a privately owned public utility with the consent of such public utility at a price agreed to between the authority and such public utility, and the Public Utilities Commission of the State of California shall have no jurisdiction with respect thereto. * * *’
8. ‘s 6.12. The governing body of any public corporation within the metropolitan area may petition the authority by resolution for an extension of mass rapid transit service, and the authority shall provide for a public hearing to consider such petion.‘Upon conclusion of the public hearing, the authority shall make economic engineering studies concerning such extension of mass rapid transit services; and if such extension is shown to be economically feasible, the authority shall proceed to engineer, finance, construct, and operate such mass rapid transit services.’‘s 11.2. In the event economic engineering studies of the authority show public transit needs to exist in specific areas but that studies of feasibility do not show sufficient income to support the required financing by revenue bonds, then the authority in cooperation with public agencies within said area shall determine the boundaries of a transit district within the Los Angeles metropolitan area which requires such services and, through duly constituted powers of local agencies propose and support the creation of said transit district with powers provided by voters for the taxation of property and the financing of said district through general obligation bonds adequate to engineer, construct and operate such required system of transit. The said district may operate such facilities independently for the benefit of the people or, by contract or otherwise, may enter into agreement with the Los Angeles Metropolitan Transit Authority for coordinated operation of such facilities and the authority shall thereupon integrate the operations of such system with all its other transit operations to develop public transit services for the benefit of the people of the metropolitan area.’
9. ‘The Legislature, in placing the authority under the jurisdiction of the Public Utilities Commission * * * has made exceptions to a long established policy because of the unique character of the authority and the particular circumstances and conditions requiring its creation. It is not the intent of the Legislature that these exceptions be deemed, in any way, a precedent with respect to any other public corporation.’ Stats.1951, ch. 1668, s 13.4.
10. “Rapid transit' means transportation * * * by means of suspended overhead monorail on routes which the California Public Utilities Commission has first determined are required by public convenience and necessity, together with any supplemental feeder bus lines which established common carriers of passengers serving the area decline to provide after that commission has determined they are required by public convenience and necessity.' Stats.1951, ch. 1668, s 2.7. or other charges. * * *‘ Stats.1951, ch. 1668, s 4.9.
11. ‘Subject to the jurisdiction of the Public Utilities Commission, the authority may fix rates, fares, tolls, charges, rents
12. ‘Subject to the provisions of the Public Utilities Act and authorization pursuant thereto from the Public Utilities Commission, the authority may make contracts, lease and agreements with any person or public corporation. * * *’ Stats.1951, ch. 1668, s 4.12.
13. Section 3.6(b) (The Authority may enter into contracts for superintendence of the system): ‘* * * Neither such contract, nor the corporation which is a party thereto with respect to its rights and duties thereunder, shall be subject to control or regulation by the Public Utilities Commission. * * *’Section 4.6 (The Authority may condemn privately owned passenger stage operations): ‘* * * Sections 1401 to 1421, inclusive, of the Public Utilities Code shall not apply to any such condemnation of property of a privately owned public utility with the consent of such public utility at a price agreed to between the authority and such public utility, and the Public Utilities Commission of the State of California shall have no jurisdiction with respect thereto. * * *’Section 4.21 (The Authority must purchase certain existing privately owned systems): ‘Section 851 of the Public Utilities Code shall not apply to any contract for sale or sale of an existing system or portion thereof or other action taken pursuant to this section, and the Public Utilities Commission of the State of California shall have no jurisdiction with respect thereto.’Section 6.10 (The Authority may purchase other privately owned systems): ‘* * * Section 851 of the Public Utilities Code shall not apply to such contract, or to any sale of assets or other action taken pursuant to such contract, and the Public Utilities Commission of the State of California shall have no jurisdiction with respect thereto.’
14. Section 22 of Article XII provides:‘Said commission shall have the power to establish rates of charges for the transportation of passengers and freight by railroads and other transportation companies, and no railroad or other transportation company shall charge or demand or collect or receive a greater or less or different compensation for such transportation of passengers or freight, or for any service in connection therewith, between the points named in any tariff of rates, established by said commission than the rates, fares and charges which are specified in such tariff. The commission shall have the further power to examine books, records and papers of all railroad and other transportation companies; to hear and determine complaints against railroad and other transportation companies; to issue subpenas and all necessary process and send for persons and papers; and the commission and each of the commissioners shall have the power to administer oaths, take testimony and punish for contempt in the same manner and to the same extent as courts of record; the commission may prescribe a uniform system of accounts to be kept by all railroad and other transportation companies.‘No provision of this Constitution shall be construed as a limitation upon the authority of the Legislature to confer upon the Public Utilities Commission additional powers of the same kind or different from those confered herein which are not inconsistent with the powers conferred upon the Public Utilities Commission in this Constitution, and the authority of the Legislature to confer such additional powers is expressly declared to be plenary and unlimited by any provision of this Constitution.’ (Italics added.)The power to certify passenger stage operations or other operations is not among those given the Commission under this section, and the granting of such power by the Legislature or its subsequent modification or withdrawal would therefore not be ‘inconsistent with the powers conferred upon the Public Utilities Commission in this Constitution.’
TRAYNOR, Justice.
GIBSON, C. J., and SHENK, SCHAUER, SPENCE, McCOMB, and PETERS, JJ., concur.
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Docket No: S. F. 20049.
Decided: May 12, 1959
Court: Supreme Court of California, In Bank.
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