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Lynchburg Gas Co. v. Federal Power Commission

November 23, 1960


Author: Mclaughlin

Before McLAUGHLIN, KALODNER and HASTIE, Circuit Judges.

McLAUGHLIN, Circuit Judge.

Petitioner, Lynchburg Gas Company (hereafter referred to as Lynchburg) has filed two separate petitions for review under Section 19(b) of the Natural Gas Act, 15 U.S.C.A. § 717r(b) seeking review of certain orders made by the Federal Power Commission in a rate proceeding involving The Manufacturers Light and Heat Company (hereafter referred to as Manufacturers).

In the first of the petitions, Docket No. 13,170, Lynchburg contends it is aggrieved by two orders of the Commission, one dated November 18, 1959, which denied petitioner the right to intervene in the Manufacturers' rate proceeding, and the other dated December 30, 1959, which allowed Lynchburg to intervene and participate in that cause "henceforth". In addition to responding to the arguments on the merits, the Commission and Manufacturers have filed motions to dismiss for lack of jurisdiction.

In the second petition, Docket No. 13,285, Lynchburg seeks review of the final order in the Manufacturers' action asserting it is aggrieved by the decision itself as well as by the Commission's determinations on its petition to intervene. This second petition is before the court on motion to dismiss for lack of jurisdiction.

Lynchburg is a Virginia corporation engaged in purchasing, distributing and selling natural gas in Lynchburg, Virginia and other surrounding areas. It purchases its total natural gas requirement from Atlantic Seaboard Corporation, a subsidiary of the Columbia Gas System, Inc. (hereafter referred to as Columbia). Manufacturers is also a subsidiary of Columbia, but Lynchburg does not buy, either directly or indirectly, any gas from Manufacturers. Except for the fact that Manufacturers and Atlantic Seaboard Corporation are both subsidiaries of Columbia, there is no connection between Lynchburg and Manufacturers.

On various dates, Manufacturers, Atlantic Seaboard Corporation, and several other Columbia subsidiaries made simultaneous rate filings with the Federal Power Commission.*fn1

On September 3, 1959, the Commission issued a "Notice of Date of Hearing", in two of the filed rates of Manufacturers.*fn2 Lynchburg gave timely notice to intervene, but at the date set for the beginning of the hearing before the examiner, September 30, 1959, Lynchburg's petition to intervene had not been passed upon by the Commission. Nevertheless, the examiner, in order to expedite the hearing, granted Lynchburg full rights of participation until such time as the Commission should act upon its petition.

As the situation developed, the sole point, not susceptible of settlement through negotiation was "rate of return" between Manufacturers and its customers. Lynchburg was not interested in any of the questions upon which there would be settlement, but only in the contested issue. After several days of hearing spread over one and a half months, the direct case of Manufacturers and rebuttal thereto had been fully heard. During a recess after that, the Commission denied Lynchburg's petition to intervene. Thereafter, on November 19, 1959, Lynchburg did not appear and did not participate in the hearing when certain documentary evidence upon which there had been oral testimony and the settlement agreement between Manufacturers and its customers were formally introduced into evidence. The hearing was recessed with the only remaining matter being the filing of briefs and the oral argument on January 7, 1960. During the interim period Lynchburg filed its petition for rehearing and on December 30, 1959, the Commission reversed its previous order stating:

"Upon consideration of the aforementioned application, we find that Lynchburg should be permitted to intervene and participate henceforth in the proceedings in Docket No. G-12197."

Lynchburg filed a motion for continuance to change the date set for oral argument, which was denied by the Commission. Lynchburg did not submit a brief or participate in the oral argument. Subsequently, a final order was entered on February 25, 1960.

In Docket No. 13,170, we are immediately confronted with the problem of jurisdiction to review the Commission's order denying intervention. The applicable statute is Section 19(b) of the Natural Gas Act, 15 U.S.C.A. § 717r(b), which provides in part:

"(b) Any party to a proceeding under this chapter aggrieved by an order issued by the Commission in such proceeding may obtain a review of such order in the circuit court of appeals of the United States * * * by filing in such court, within sixty days after the order of the Commission upon the application for rehearing a written petition praying that the order of the Commission be modified or set aside in whole or in part."

As a primary requisite for judicial review, the statute dictates mandatory compliance with the doctrine of exhaustion of administrative remedies, as well as compliance with the required showing of a party who is aggrieved by a Commission order. See F.P.C. v. Colorado Interstate Gas Co., 1955, 348 U.S. 492, 75 S. Ct. 467, 99 L. Ed. 583; Natural Gas Pipeline Co. v. Federal Power Comm., 3 Cir., 1958, 253 F.2d 3, 9. In Docket No. 13,170, Lynchburg seeks direct review of the Commission's order, made during the proceedings denying its petition for intervention. As a general rule, such intermediate orders cannot be reviewed on an interlocutory basis, but may be considered on appeal from the final order in the proceeding. Federal Power Comm. v. Metropolitan Edison Co., 1938, 304 U.S. 375, 58 S. Ct. 963, 82 L. Ed. 1408; United Gas Pipe Line Co. v. Federal Power Commission, 3 Cir., 1953, 206 F.2d 842. Notwithstanding the general applicability of the above rule, Lynchburg asserts that under the authority of a recent decision ...

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