Peevey Alternate Comment Dec. on Opinion Regarding the Applications to Modify or Clarify Resolution G-3304

Discussion

Our focus in this decision is whether or not the Resolution should be modified or clarified, and if so, whether the intention of the Resolution was to preclude all transfers into core subscription or core service on and after December 21, 2000.

The first issue to address before reaching the issue of whether the Commission should modify or clarify Resolution G-3304, is whether the requests of Tenby and SoCalGas amount to requests for declaratory relief or an advisory opinion. As noted in the March 7, 2002 ALJ ruling and the February 7, 2003 scoping memo and ruling, the Commission generally disfavors issuing a decision that provides declaratory relief (D.97-10-087 [76 CPUC2d 287, 325, 326];
D.97-09-058 [75 CPUC2d 624, 625]; D.91-11-045 [abstracted at 42 CPUC2d 9]), or which is advisory in nature (D.97-09-058 [75 CPUC2d 624, 625]).

Tenby's lawsuit against SoCalGas and Sempra involves, among other things, Tenby having to purchase natural gas in January 2001 due to SoCalGas' alleged breach of contract to provide Tenby with GN-10 service during that month. Although the Resolution was not mentioned in Tenby's complaint in the lawsuit, SoCalGas demurred to the complaint on the grounds that the Superior Court lacks subject matter jurisdiction over the issues raised in Tenby's civil complaint, and that the court cannot review the Resolution. (Tenby Response To March 7, 2002 Ruling, Exh. 2.)

Both Tenby and SoCalGas stipulated to stay the lawsuit until the Commission addresses their respective applications to modify or clarify the Resolution. Tenby requests that the Commission clarify or modify the Resolution to state that anyone who elected to take core subscription or core service from SoCalGas prior to the effective date of the Resolution is not barred from taking such service. SoCalGas requests an interpretation that would prevent a noncore customer who elected core subscription or core service before the effective date of the Resolution from transferring to core or core subscription service beginning on January 1, 2001.

SoCalGas contends that it is not asking the Commission to adjudicate the specific rights of any party, or to adjudicate the pending civil suit. SoCalGas states that it is "not seeking a declaratory order from the Commission, but instead is requesting modification/clarification of Resolution G-3304." (SoCalGas 3/25/02 Response, p. 2.) However, it is clear that the applications of both SoCalGas and Tenby are requesting that the Commission interpret the Resolution in a way that will affect the pending Superior Court action involving Tenby's purchase of natural gas from an entity other than SoCalGas in January 2001.¹⁰ Thus, we conclude that the applications of Tenby and SoCalGas to clarify or modify Resolution G-3304 are requests for declaratory relief.

Although the Commission generally disfavors issuing a decision in response to a request for declaratory relief or an advisory opinion, the Commission has made some exceptions. The Commission has issued decisions which provide declaratory relief or are advisory in nature when extraordinary circumstances exist, or if the matter is of widespread public interest.
(D.97-09-058 [75 CPUC2d 624, 626]; D.95-01-014 [58 CPUC2d 470, 476]; D.93-08-030 [50 CPUC2d 518, 521]; D.91-11-045 [42 CPUC2d 9]; D.87-12-017 [26 CPUC2d 125, 130].)

Even if their applications are deemed to be requests for declaratory relief, SoCalGas states in its response to the March 7, 2002 ruling, and Tenby's reply of April 8, 2002 agrees, that there are legal and policy reasons for issuing a decision in response to a request for declaratory relief. Thus, the next issue we address is whether the legal and policy reasons cited by SoCalGas and Tenby are sufficient to justify issuing a decision which provides declaratory relief or which is advisory in nature.

The first reason that SoCalGas cites in support of the issuance of a Commission decision clarifying or modifying the resolution is Public Utilities Code Section 1759. That code section provides in part that "[n]o court of this state, except the Supreme Court and the court of appeal ... shall have jurisdiction to review, reverse, correct, or annul any order or decision of the commission or to suspend or delay the execution or operation thereof, or to enjoin, restrain, or interfere with the commission in the performance of its official duties...." SoCalGas contends that this code section prevents the Superior Court from taking any action that would have the effect of overruling a Commission decision or resolution. The basis for SoCalGas' demurrer to the civil action is that the Superior Court lacks subject matter jurisdiction to interpret the Resolution, and that several court cases have prevented the trial courts from hindering or frustrating the policies of the Commission.

SoCalGas also contends that when the Superior Court examines the Resolution, it may decide that the Resolution is ambiguous. Because of the potential ambiguity, SoCalGas contends the Commission should determine the meaning of its own decisions and resolutions as a policy matter. SoCalGas states that since the Commission and the staff were directly involved with the Resolution, the Commission is in a far better position than the trial court to determine the meaning of the Resolution. SoCalGas also asserts that by having the Commission interpret its own decision, that this will prevent the Superior Court from having to subpoena the Commissioners or its employees to clarify the Resolution. If the Resolution is ambiguous, Tenby contends that a hearing should be held to properly determine the intent of the Resolution.

SoCalGas further contends that having the Commission interpret the Resolution will promote one of the purposes of the "primary jurisdiction doctrine," which is to ensure the uniform application of regulatory policy. SoCalGas also contends that the Commission should not establish the precedent of deferring to the civil court to interpret a Commission decision or resolution.

The primary jurisdiction doctrine "applies where a claim is originally cognizable in the courts, and comes into play whenever enforcement of the claim requires the resolution of issues which, under a regulatory scheme, have been placed within the special competence of an administrative body; in such a case the judicial process is suspended pending referral of such issues to the administrative body for its views." (Farmers Insurance Exchange v. Superior Court (1992) 2 Cal.4th 377, 390, italics omitted.) As a result of the stipulation filed in the Superior Court action, the trial court has essentially exercised the primary jurisdiction doctrine and referred the issue of clarifying or modifying the Resolution back to us.

The issue of whether the Commission needs to clarify or modify the Resolution depends on whether extraordinary circumstances exist, or if the matter is of widespread public interest. Since the Resolution affects the rights and obligations of Tenby and SoCalGas during December 2000 and January 2001, these proceedings are of some public interest. In addition, the issue of whether SoCalGas had to provide core service to Tenby in January 2001 is a key issue in the pending civil lawsuit.

An opinion that clarifies our view of the Resolution and which will resolve an actual controversy, will also be of benefit to the Superior Court. We recognize that without such clarification, the Superior Court might interpret Resolution
G-3304 in a manner the Commission did not intend. The Commission should not leave the interpretation of its decisions and resolutions to the Superior Court, and the court should not be burdened with having to hear evidence as to the Commission's intent, which might include requiring Commission personnel to appear to testify in this regard. Since the trial of the civil lawsuit is scheduled for September 2003, clarification of the Resolution will also ensure that the intent behind the Resolution will be carried out. Accordingly, we will clarify our intent in Resolution G-3304 in this particular circumstance.

Prior to clarifying the Resolution, we note that Tenby provided SoCalGas with the 20-day notice to switch on December 7, 2000, as required by its contract.¹¹ No hearings are needed in these proceedings to establish that Tenby provided the required notice. Tenby's notice occurred prior to the adoption and effective date of Resolution G-3304.

We agree with Tenby that the wording of Resolution G-3304 did not invalidate existing notices to switch, such as Tenby's, that were entered into prior to the effective date of the Resolution. Therefore, we clarify that we did not intend in Resolution G-3304 to invalidate the transfer of a noncore customer to core service or core subscription service if such a notice of transfer was provided prior to the effective date of Resolution G-3304. Regardless of whether the date of the new service was prior to or after the effective date of the Resolution, the Resolution did not invalidate Tenby's December 7, 2000 notice to switch to
GN-10 service. Based on the specific facts before us, Resolution G-3304 is clarified as discussed above, and there is no need to make any changes to the wording of Resolution G-3304.

Since the Commission cannot award damages, Tenby's remedy is to pursue its request for damages in the Superior Court.

The last item of discussion is Tenby's request that the Commission address Tenby's data request to SoCalGas. Since today's decision clarifies Resolution
G-3304, and finds that Tenby's December 7, 2000 notice to switch was provided in accordance with the applicable contract provisions, Tenby's data request to SoCalGas is moot.

¹⁰ We are not persuaded by SoCalGas' argument that its application should not be considered a request for declaratory relief because the Resolution may affect other noncore customers besides Tenby. It is apparent that if the Commission interprets the Resolution as suggested by Tenby or SoCalGas, the Resolution will have a direct impact on the pending civil matter. ¹¹ In the March 7, 2002 ruling, the ALJ requested that the parties submit the related civil pleadings. In response to the ruling, Tenby submitted, among other documents, the civil complaint. Attached to the complaint as Exhibit A was the "Master Services Contract" between Tenby and SoCalGas, which governed the intrastate transportation service provided by SoCalGas. In Schedule A, Section 1, paragraph B, of the Master Services Contract, it states that the agreement is to continue "on a month to month basis unless terminated by written notice from one party to the other given not less than twenty (20) days prior to the last day of the initial term of any month thereafter." As part of SoCalGas' response filed on March 25, 2002, SoCalGas submitted the pleadings it had filed in the Superior Court. Among the filings was SoCalGas' demurrer to Tenby's complaint. In the Memorandum of Points and Authorities at page 3 in support of SoCalGas' demurrer to Tenby's civil complaint, filed on November 15, 2001 in Superior Court, SoCalGas stated: "As artfully pleaded by Tenby, as of December 7, 2000, CPUC regulations permitted a non-core customer such as Tenby, upon providing the required 20 days' notice, to elect to transfer from its Master Service Contract and Intrastate Transmission Agreement and enter into a core service contract with SoCalGas effective January 1, 2001." At page 8 of the Memorandum of Points and Authorities, SoCalGas stated: "On December 7, 2000, when Tenby requested its transfer from non-core transportation only customer status to a GN-10 service beginning January 1, 2001, such a transfer was permissible under the then existing CPUC regulations."