IV. The Motion for Adoption of the Settlement

On November 22, 1999, shortly after the investigative documents were released by the Department of Justice, RRB and Hillview filed the Motion. The grounds asserted in support of adopting the Settlement were:

"(a) That [the] Settlement commands the unanimous sponsorship of all active Parties to this proceeding;

"(b) That the Parties are fairly representative of all affected interests;

"(c) That no term of this Settlement contravenes any statutory provision or any decision of the Commission, and

"(d) That this Settlement together with the record in this proceeding conveys to the Commission sufficient information to permit the Commission to discharge its regulatory obligations with respect to the Parties and their interest." (Motion, p. 2.)

The Motion also states that the Settlement is "reasonable in light of the whole record, consistent with applicable law, and in the public interest." (Id.)

The settling parties ask us to adopt the Settlement as a complete resolution of all issues in this proceeding, although they do not expressly ask us to dismiss the proceeding. The Motion is signed on behalf of RRB and Hillview by their respective counsel, but not on behalf of Forrester personally. The accompanying Settlement is signed by the staff witness on behalf of RRB, and by Forrester solely on behalf of Hillview.

Comments contesting the Settlement were filed by several interested parties, and objections in petition form were also received from nearly fifty Hillview customers. Pursuant to Rule 51.6(b) the ALJ held a second PHC in Oakhurst on March 20, 2000, in order to establish a procedure to develop the record and consider whether to recommend adoption of the Settlement. At this PHC the staff witness represented RRB, unaccompanied by counsel.

Under Rule 51.6(a) the ALJ set a hearing for May 16 on all material contested issues of fact and law raised by the Motion and responsive comments. (ALJ Ruling dated April 25, 2000.) This Ruling specifically required the settling parties, and any contesting parties who intended to participate in the hearing, to serve prepared testimony of all anticipated witnesses on the other parties.

The settling parties served no prepared testimony before the May 16 hearing. However, on April 20 they served a document titled, "Joint Report on the Reimbursement of Fees at Issue in the Investigation into Hillview Water Company's Operations, Rates, and Charges" (Joint Report) on other parties. The Joint Report is a brief explanation of how RRB prepared a list of some 250 customers upon whom Hillview may have assessed unauthorized supply and storage fees. The list is attached. It indicates whether or not RRB and Hillview consider each claim to be reimbursable. This Joint Report is not signed or verified, and does not address any contested issue raised in the OII.⁷ Other than the written Motion and the attached Settlement, the Joint Report is the only item offered in support of the settling parties' request for adoption of the Settlement.

Staff Counsel, speaking on behalf of the settling parties, explained that they intended that the Joint Report supplement the information they had presented in the Settlement. (Tr., May 16, 2000, pp. 4-5.) The two documents were to comprise the settling parties' entire evidentiary presentation, although these parties additionally proposed to make the RRB staff witness available for cross-examination. Staff counsel assumed this procedure would be followed in lieu of that which had been specified in the April 25 Ruling. (Id., p. 7.) Over objection by the interested parties, the ALJ permitted the hearing to proceed on this basis, and the Settlement and Joint Report were received as exhibits for the record.⁸ The Prepared Testimony of Jane Cavin,⁹ LWB's 1997 Report (with exhibits), and Hillview's 1994 Rate Base Calculations were also received for the record.