PER CURIAM.
In Docket No. 315541, Consumers Energy Company appeals as of right the trial court's grant of summary disposition in favor of the city of Holland in a declaratory judgment action concerning Holland's right to provide electric service to a customer. In Docket No. 320181, Consumers Energy Company appeals as of right the trial court's grant of summary disposition in favor of the city of Coldwater in a declaratory judgment action concerning Coldwater's right to provide electric service to property that Coldwater recently purchased. We affirm in both cases.
Holland filed this declaratory action contending that under the Michigan Constitution and by statute, a municipal utility such as itself can supply light and power within and outside its corporate boundaries to any customer not already receiving the service from another utility. According to Holland, it obtained irrevocable franchises for the delivery of electric power to townships adjoining it, including Park Township. A nonprofit corporation, Benjamin's Hope, owned vacant property in Park Township. The property did not have electric service. Benjamin's Hope sought to build a non-profit, tax-exempt structure on its property and sought to have Holland provide the electric power service for the building. According to Holland, defendant Consumers Energy Company has asserted that that it has the exclusive right to serve the property, having served the property some years prior, and that Benjamin's Hope must receive electric power from Consumers pursuant to relevant statutory law. Holland, therefore, sought a declaration that it was authorized to provide electric service to Benjamin's Hope under the Michigan Constitution, its franchise agreement, statute, and the Holland city charter.
In lieu of an answer, Consumers filed a motion for summary disposition premised on MCR 2.116(C)(8) and (10). Consumers claimed that it had previously provided electric service to the customer at issue and was currently doing so and provided an affidavit and copies of electric bills to support its position. Consumers further asserted that the case of Great Wolf Lodge of Traverse City, LLC v. Pub. Serv. Comm., 489 Mich. 27, 799 N.W.2d 155 (2011), already addressed, in Consumers' favor, most of the issues raised in this case. Finally, Consumers asserted that
Holland responded that the only service Consumers provided was temporary and requested by a contractor hired by Benjamin's Hope. Consumers provided the electric service to a construction trailer temporarily located on the property. When the contractor removed its trailer from the property, it also requested that Consumers remove its facilities from the property, which Consumers did. Benjamin's Hope thereafter requested quotes from both Consumers and Holland for the provision of permanent electric services, which both provided. Benjamin's Hope chose Holland, as it was allowed to do, given that Consumers was not providing service to the property at that time. Holland further asserted that the PSC does not have jurisdiction over this matter and PSC Rule 411 does not apply to municipal utilities. Holland requested summary disposition in its own favor under MCR 2.116(I)(2).
The trial court granted Holland's motion for summary disposition and denied Consumers' motion. The trial court opined that Holland is not subject to regulation by the PSC and that the customer that Holland began providing power to in April 2012 was not, and had not been, a Consumers' customer, it having never before received power from another utility.
On appeal, Consumers first argues that Holland's provision of electric service to Benjamin's Hope clearly violated MCL 124.3 because Consumers had been providing service to the property at issue when Holland entered into a contract with Benjamin's Hope to provide service to the property. Consumers contends that the trial court's erroneous conclusion otherwise was based on the adoption of an illogical and incorrect definition of the word "customer" for purposes of MCL 124.3. We disagree.
"Issues of statutory interpretation are questions of law that this Court reviews de novo." Spectrum Health Hosps. v. Farm Bureau Mut. Ins. Co. of Mich., 492 Mich. 503, 515, 821 N.W.2d 117 (2012). We also review de novo a trial court's decision on a motion for summary disposition. See Dressel v. Ameribank, 468 Mich. 557, 561, 664 N.W.2d 151 (2003). A motion under MCR 2.116(C)(8) tests the legal sufficiency of the plaintiff's complaint by examining the pleadings alone. Patterson v. Kleiman, 447 Mich. 429, 432, 526 N.W.2d 879 (1994). All well-pleaded factual allegations are taken as true, as well as any reasonable inferences or conclusions that can be drawn from the allegations. Peters v. Dep't of Corrections, 215 Mich.App. 485, 486, 546 N.W.2d 668 (1996). The motion should be granted only if the claims are so clearly unenforceable as a matter of law that no factual development could justify recovery. Id. at 487, 546 N.W.2d 668.
Summary disposition may be granted under MCR 2.116(C)(10) if the documentary evidence submitted by the parties, viewed in the light most favorable to the nonmoving party, shows that there is no genuine issue regarding any material fact and the moving party is entitled to judgment as a matter of law. Veenstra v. Washtenaw Country Club, 466 Mich. 155, 164, 645 N.W.2d 643 (2002). Summary disposition may be granted in favor of an opposing party under MCR 2.116(I)(2) if there is no genuine issue of material fact and the opposing party is entitled to judgment as a matter of law. 1300 LaFayette East Coop., Inc. v. Savoy, 284 Mich.App. 522, 525, 773 N.W.2d 57 (2009).
In January 2012, Benjamin's Hope requested quotes from both Consumers and Holland for permanent electric service. On the basis of the prices quoted, Benjamin's Hope signed a contract with Holland on January 25, 2012, for electric service. Consumers asserts that this was a violation of MCL 124.3(2) as it was providing electric service to the premises at the time Holland entered into a contract with Benjamin's Hope.
MCL 124.3 provides:
Plain statutory language must be enforced as written. Echelon Homes, LLC v. Carter Lumber Co., 472 Mich. 192, 196, 694 N.W.2d 544 (2005). This includes, without reservation, the Legislature's choice of tense. For example, in addressing a family court's subject matter jurisdiction, a panel of this Court concluded that the present tense language in MCL 712A.2(b)(2), granting jurisdiction over a juvenile "[w]hose home or environment, by reason of neglect, cruelty, drunkenness, criminality, or depravity ... is an unfit place for the juvenile to live in," requires the trial court to examine the child's situation at the time the petition for jurisdiction was filed. In re MU, 264 Mich.App. 270, 278-279, 690 N.W.2d 495 (2004).
In this case, employing the dictionary definitions and the relevant tense to the terms used in the statute, MCL 124.3(2) prohibits Holland from providing electric delivery service to customers presently taking or getting the service from another utility. The statute does not, however, prohibit Holland from providing electric delivery service to customers who "have received" or "had received" the service from another utility at some point in time.
MCL 124.3(3)(a) refers us to MCL 460.10y for the definition of "electric delivery service." MCL 460.10y(12)(a), in turn, defines "delivery service" as "the providing of electric transmission or distribution to a retail customer." As indicated by Consumers, neither MCL 124.3, nor MCL 460.10y(12)(a) make a distinction between temporary or permanent electric service. Therefore, whether Consumers was providing temporary or permanent service is irrelevant. However, under the definition of "delivery service," referred to in MCL 124.3 (and as defined in MCL 460.10y(12)(a)), Consumers must have been providing the service "to a retail customer." This is an essential phrase, which leads us to our primary issue.
"Customer" is not defined in MCL 124.3. But, "customer" is defined in MCL 460.10y(2). MCL 460.10y(2) states, "For purposes of this subsection, `customer' means the building or facilities served rather than the individual, association, partnership, corporation, governmental body, or any other entity taking service." "Building" is not defined in this statute, nor is "facilities." We therefore look to the dictionary for guidance. We consult a lay dictionary when defining common
"Building" is defined in The American Heritage Dictionary (5th ed.) as "[s]omething that is built, as for human habitation; a structure." "Facilities" is the plural of "facility," which is defined as something "designed to serve a particular function[.]" Id. Under the relevant definitions, the building or facility that Consumers was serving, i.e., the customer, was the CL Construction trailer. The buildings and facilities for which Benjamin's Hope contracted with Holland for electric service were not "customers" of Consumers. Consumers never provided service to those buildings, given that they did not previously exist, and Holland was free to provide electric service to them without violating MCL 124.3.
The limiting language, "[f]or purposes of this subsection...." in MCL 460.10y(2) is acknowledged. However, because MCL 124.3(3)(a) refers us back to MCL 460.10y for the definition of "delivery service," and the definition of "delivery service" in MCL 460.10y(12)(a) contains the word "customer," it would make sense to look within that same statute for the definition of that essential word. The doctrine of noscitur a sociis, i.e., that "a word or phrase is given meaning by its context or setting," assists us in reaching this conclusion. See G.C. Timmis & Co. v. Guardian Alarm Co., 468 Mich. 416, 420-421, 662 N.W.2d 710 (2003) (quotation marks and citation omitted). In addition, statutes that relate to the same matter are considered to be in pari materia. People v. Perryman, 432 Mich. 235, 240, 439 N.W.2d 243 (1989). "Statutes that address the same subject or share a common purpose are in pari materia and must be read together as a whole." People v. Harper, 479 Mich. 599, 621, 739 N.W.2d 523 (2007). "The general rule of in pari materia requires courts to examine a statute in the context of related statutes." People v. Lewis, 302 Mich.App. 338, 343, 839 N.W.2d 37 (2013).
While Consumers argues that "customer" cannot be defined as an inanimate object, Consumers fails to recognize the fact that its own arguments are based on the same premise. Consumers' principal argument is that because it first served the property — that being the land itself — Consumers could claim the property (an inanimate object) as its customer forever, no matter who owned it at any point in time thereafter and whether any buildings stood upon it and were receiving electric service.
The trial court appropriately determined that Holland could provide electric service to Benjamin's Hope without violating MCL 124.3.
Consumers next contends that the trial court erred by allowing Holland to provide electric service to Benjamin's Hope because Consumers was entitled to serve the property under PSC Rule 411(11) and Great Wolf Lodge, 489 Mich. 27, 799 N.W.2d 155. We again disagree.
MCL 460.6(1) provides, in relevant part:
"Although broadly stated, § 6(1) is not a grant of specific power. It is merely an outline of the PSC's jurisdiction." Attorney General v. Pub. Serv. Comm., 189 Mich.App. 138, 145, 472 N.W.2d 53 (1991). Under the express language of § 6(1), the PSC has no jurisdiction over a municipally owned utility such as Holland. Lacking
Rule 411 provides, in relevant part:
According to Consumers, because it supplied electric service to the Benjamin's Hope property in 2004, 2006, 2008 and then again in 2011 to the CL Construction trailer (which qualified as a "customer"), it was the first utility serving the customer and thus was entitled to serve the entire electric load on the premises of that customer. However, PSC Rule 102(l)
The Michigan Legislature also specifically stated as much, giving municipally owned utilities the option of complying with Rule 411 if the utility provides service to customers outside its municipal boundaries (as in this case). MCL 460.10y(3) provides:
Given this statute, Rule 411 is inapplicable.
Consumers contends that the holding in Great Wolf Lodge, 489 Mich. 27, 799 N.W.2d 155, requires a different conclusion. However, that case is factually distinguishable. First and foremost, the plaintiff, Great Wolf Lodge of Traverse City, contracted with Cherryland Electric Cooperative to provide electric service to property where it intended to build a water park resort. Cherryland had provided electric service to the farm buildings located on the property when the plaintiff purchased it. While the plaintiff sought bids from competing electric companies and later indicated that Cherryland coerced it into contracting for electric services to avoid construction delay, the fact remains that the plaintiff did enter into a three-year contract to have Cherryland provide electric services to its newly constructed buildings. A rate dispute followed, two years after which the plaintiff sought a declaratory ruling that it could receive electric service from whatever provider it chose. In this case, by contrast, Benjamin's
In addition, Great Wolf Lodge was an appeal from a PSC decision. A party aggrieved by a PSC order must show by clear and satisfactory evidence that the PSC's order is unlawful or unreasonable. MCL 462.26(8). A final order of the PSC must be authorized by law and, if a hearing is required, supported by competent, material, and substantial evidence on the whole record. Const. 1963, art. 6, § 28. A reviewing court gives due deference to the PSC's administrative expertise, and is not to substitute its judgment for that of the PSC. In re Mich. Consol. Gas Co. Application, 304 Mich.App. 155, 164, 850 N.W.2d 569 (2014). The Court's review in Great Wolf Lodge was thus deferential and limited and it reinstated the PSC decision, whereas our review here is de novo. We are not so limited.
Next, the Court in Great Wolf Lodge, 489 Mich. at 39, 799 N.W.2d 155, stated:
In this case, it could be argued that there would be no unnecessary duplication of electric facilities because it appears both utilities currently stand ready and able to provide the required service. It is Consumers, in fact, that quoted Benjamin's Hope with a $35,000 installation charge for service when Holland quoted no up-front installation charge for electric service.
Finally, there was no dispute that the PSC had jurisdiction over the Great Wolf Lodge dispute because Cherryland was a public utility and the disagreement was between the property owner — who sought and received service and submitted to the jurisdiction of the PSC — and the public utility concerning a rate. MCL 460.58 provides that the PSC is to investigate a complaint by a customer that a rate or regulation by a public utility is unjust, inaccurate, or improper. In contrast, the dispute in this case is between a public utility and a municipal utility. The Court in Great Wolf Lodge, 489 Mich. at 41-42, 799 N.W.2d 155, opined:
Again, it is of utmost importance that the parties before the PSC and then before the Great Wolf Court were a plaintiff who was receiving or going to receive service and a public utility. The Great Wolf Court's note that Rule 411 limits the rights of the owner of the premises has no bearing on the case at hand where the owner of the premises is not a party to the dispute. We are not called on to determine the rights of the premises owner. Rule 411 may well limit the rights of the premises owner, but it does not limit the rights of a municipal utility such as Holland because the PSC has no jurisdiction over municipal utilities. The Great Wolf Court implicitly acknowledged the distinction:
Incidentally, MCL 124.3 would have precluded TCLP, a municipal utility, from contracting with Great Wolf Lodge, because Great Wolf Lodge was undeniably receiving service from Cherryland, under its contract with them, for over two years. But the point to be gleaned from the Supreme Court's decision in Great Wolf is this: even if MCL 124.3 did not so restrict a municipal utility, Rule 411 would still have restricted Great Wolf Lodge because it, as an owner of premises who had service first provided by a public utility, could have its rights limited by Rule 411. Because the instant dispute is between the municipal utility and a public utility, MCL 124.3 applies, but, as previously indicated, it does not restrict Holland from contracting with Benjamin's Hope to provide electric service. We therefore affirm the trial court's ruling in Docket No. 315541.
The city of Coldwater filed this declaratory action contending that under the Michigan Constitution and by statute, a municipal utility such as itself can supply light and power within and outside its corporate boundaries to any customer not already receiving the service from another utility. Coldwater sought to provide electric service to a 6.2 acre parcel of land in Coldwater Township it purchased in July 2011 which, at that time, contained a vacant pole barn that had a service drop owned by Consumers attached to it but, according to Coldwater, had no service provided to it since before the time Coldwater purchased the parcel. Coldwater asserted that it intends to remove the pole barn and build new facilities and further intends to provide its own electric supply (through the Coldwater Board of Public Utilities) but that Consumers insists that it has the exclusive right to provide electric power to the property.
Consumers moved for summary disposition under MCR 2.116(C)(10). Consumers argued that when Coldwater purchased the property, there was an existing customer of Consumers on the property and Consumers had a history of providing service to the premises up until roughly a month before Coldwater's purchase of the property. Consumers stated that Coldwater's claims were thus precluded by MCL 124.3 and PSC Rule 411.
Coldwater filed a countermotion for summary disposition in its own favor based on MCR 2.116(C)(10). Coldwater contended that electric service to the existing pole
The trial court granted summary disposition in favor of Coldwater. In its opinion, the court noted that municipally owned utilities are exempt from the power and jurisdiction of the PSC and that Coldwater, being both the owner of the premises and a municipal utility, was, as both an owner and provider, not subject to the power of the PSC. The trial court also noted that MCL 124.3 precludes a municipal electric service provider from providing service only if the customer is already receiving service from another provider and that there were no buildings or facilities receiving electric service at the time Coldwater purchased the parcel in question, nor had Coldwater ever received service from Consumers.
On appeal, Consumers argues that the trial court erred by creating an exception to the applicability of PSC Rule 411 on the basis that Coldwater was both a utility and the customer when Rule 411 allows for no such exception. Contrary to Consumers argument, the trial court did not hold that because the owner of the premises is a municipal utility it also cannot be regulated by the PSC in its capacity as a customer. It simply held, though its reasoning was inartfully worded, that if Coldwater were simply a premises owner and nothing more, Great Wolf Lodge would likely apply. However, that was not the factual scenario before the trial court. The trial court could not disregard that Coldwater was the municipally owned service provider that would be providing service to itself. Its status as a municipally owned utility had to be taken into consideration when determining whether Rule 411 applied. If Coldwater were not going to be providing the service to itself, the parties would likely not be before the court arguing whether Rule 411 applied. If Coldwater were simply the premises owner and Consumers and another public utility were involved, the application of Rule 411 would be a foregone conclusion.
However, as discussed earlier in this opinion with regard to Holland, Rule 411 does not apply to municipal utilities. Coldwater in this case is a municipally owned utility seeking to provide services to its own property. Its identity as a customer and a municipally owned utility are not separable. This is necessarily so, given that it cannot contract with itself to provide a service to itself.
As thoroughly discussed regarding Docket No. 315541, the PSC has no jurisdiction over municipally owned utilities
Consumers also asserts that the trial court erred in its interpretation of MCL 124.3 by concluding that there was no "customer" on the premises at issue in this case, given that when Coldwater purchased the property there was an existing customer that had been receiving electric service from Consumers for more than 20 years. We disagree.
MCL 124.3(2) provides that "[a] municipal corporation shall not render electric delivery service for heat, power, or light to customers outside its corporate limits already receiving the service from another utility unless the serving utility consents in writing." As explained with regard to Docket No. 315541, MCL 124.3(2) would prohibit Coldwater from providing electric delivery service to customers presently receiving (taking) the service from another utility. MCL 124.3(3) refers us to MCL 460.10y for the definition of "electric delivery service." MCL 460.10y(12)(a), in turn, defines "delivery service" as "the providing of electric transmission or distribution to a retail customer." "Customer" is not defined in MCL 124.3. But "customer" is defined in MCL 460.10y. MCL 460.10y(2) states, "For purposes of this subsection, `customer' means the building or facilities served rather than the individual, association, partnership, corporation, governmental body, or any other entity taking service."
As indicated by Consumers, the definition of customer set forth in MCL 460.10y(2) is the same as the definition of "customer" set forth in Rule 411. Rule 411(1) provides, in relevant part:
However, Consumers contends that the definition of "customer" should be interpreted, for purposes of MCL 124.3, to mean the premises of the buildings and facilities served. Consumers bases this argument on Rule 411(11), which states, "The first utility serving a customer pursuant to these rules is entitled to serve the entire electric load on the premises of that customer even if another utility is closer to a portion of the customer's load." This provision of Rule 411 does not expand the definition of "customer" in Rule 411(1)(a), let alone the definition in MCL 124.3. It is a separate provision that defines the scope of what the first utility may serve. It distinctly states that the utility may serve the premises of the customer — it does not include "premises" within the definition of "customer."
The Great Wolf Lodge decision does not direct otherwise. Consumers states that after Great Wolf Lodge, the Rule 411 definition of "customer" is the premises of the buildings and facilities that existed at the time service was established. In context, what the Great Wolf Lodge Court actually stated was:
Great Wolf Lodge, therefore, was not defining "customer" for purposes of Rule 411 (and was not expanding the definition) but was explaining the parameters of Rule 411(11) and the rights therein.
Under both MCL 124.3 and Rule 411(1)(a), "customer" means the buildings and facilities served. "Building" is defined in The American Heritage Dictionary of the English Language (5th ed.) as "[s]omething that is built, as for human habitation; a structure." "Facilities" is the plural of "facility," which is defined as something "designed to serve a particular function[.]" Id. Under the relevant definitions, there was no customer already receiving the service from Consumers. According to the evidence, Coldwater purchased the property at a public auction on July 21, 2011. The prior owner of the property had requested that electric service be discontinued to the property (which contained a pole barn) on June 28, 2011. Therefore, at the time Coldwater acquired the property and sought to demolish the pole barn and provide electric service to new buildings, there was no customer (buildings or facilities) already receiving (present tense) the service from Consumers. The trial court did not err in its interpretation of MCL 124.3, nor did it err in deciding there was no "customer" receiving service.
Consumers finally argues that the trial court misinterpreted or failed to apply Rule 411 as interpreted by the Michigan Supreme Court in Great Wolf Lodge, 489 Mich. 27, 799 N.W.2d 155, and thus erred by allowing Coldwater, a municipal utility, to provide electric service in this case. The same analysis of the Great Wolf Lodge case engaged upon and the conclusion reached in Docket No. 315541 apply in this case. The only distinguishing factor in this case is that the property owner and the municipally owned utility are one and the same. This would appear to still favor Coldwater, however, because these roles cannot be separated.
We affirm the trial court's grant of summary disposition in favor of Coldwater.
Affirmed.
BORRELLO, P.J., and SERVITTO, J., concurred.
SHAPIRO, J. (concurring).
I concur.
There are two separate issues in this case. The initial question is whether Mich. Admin. Code R. 460.3411, i.e., Michigan Public Service Commission (PSC) Rule 411, as interpreted in Great Wolf Lodge of Traverse City, LLC v. Pub. Serv. Comm., 489 Mich. 27, 799 N.W.2d 155 (2011), bars these plaintiff-municipalities from providing the challenged utility service. If we answer that question in the negative, then we must determine whether MCL 124.3(2) bars the plaintiffs from providing the service.
Defendant Consumers rightly observes that the substantive language in Great Wolf Lodge was sweeping and, in that case, it was of no consequence that the utility provider to which the premises owner sought to switch was a municipal power company rather than another PSC-regulated utility. However, the municipalities rightly point out that whatever the substantive interpretation of Rule 411, it cannot be enforced against a party that does not fall within the jurisdiction of the PSC. And the Legislature has not given the PSC jurisdiction over municipal power providers. See MCL 460.6(1) ("The public service commission is vested with complete power and jurisdiction to regulate all public
By contrast, there is no jurisdictional problem with application of MCL 124.3(2).
The issues in this case are complex, but I believe the majority's conclusions are consistent with the intent of the Legislature and Great Wolf Lodge. To the degree they are not, the Legislature, the Supreme Court, or both may take appropriate action.