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Georgia Power Co. v. Cazier

Supreme Court of Georgia

June 18, 2018

GEORGIA POWER COMPANY
v.
CAZIER et al.

          BLACKWELL, JUSTICE.

         Amy Cazier and four other consumers of retail electrical service brought this putative class action against Georgia Power Company, asserting that Georgia Power for several years has collected municipal franchise fees from customers in amounts exceeding those approved by the Public Service Commission, and seeking to recover the excess fees for themselves and a class of Georgia Power customers. In Cazier v. Georgia Power Company, 339 Ga.App. 506 (793 S.E.2d 668) (2016), the Court of Appeals held that the plaintiffs were not required to exhaust administrative remedies before bringing their putative class action. We issued a writ of certiorari to review the decision of the Court of Appeals, and we now affirm.

         1. The Public Service Commission has authorized Georgia Power to collect municipal franchise fees from its customers. The amount of the municipal franchise fee varies from customer to customer, and according to the plaintiffs, the applicable orders of the Commission provide that the amount of the fee is to be based upon the "usage revenue" collected from a customer. As the plaintiffs see it, the Commission has directed that the municipal franchise fee chargeable to any particular customer be derived from his actual consumption of electrical service. The plaintiffs allege, however, that Georgia Power has calculated municipal franchise fees differently, basing the fees not only upon "usage revenue, " but also upon other fees and charges that are not, they say, properly characterized as "usage revenue." This has resulted, the plaintiffs contend, in Georgia Power illegally collecting municipal franchise fees in excess of the amounts authorized by the Commission. For themselves and the putative class of Georgia Power customers, the plaintiffs assert claims for conversion, money had and received, unjust enrichment, and damages under OCGA § 46-2-90.[1] Georgia Power denies that it has calculated municipal franchise fees other than as required by the Commission, and Georgia Power asserts that the plaintiffs seek in this lawsuit to rewrite the applicable orders of the Commission.

         Following discovery, the plaintiffs moved for certification of a class, and Georgia Power moved for summary judgment upon several grounds, including that the plaintiffs had failed to exhaust their administrative remedies. Upon hearing these motions, the trial court dismissed the lawsuit. The trial court explained that some of the applicable orders of the Commission speak of the municipal franchise fee in terms of "usage revenue, " other applicable orders refer to "total revenue, " still other applicable orders speak of "revenue, " the Commission has defined none of these terms in this context, and to decide the merits of the putative class action, the court would have to resolve the ambiguities in the various orders of the Commission. Resolving those ambiguities would require, the court continued, "normative judgments about what it is that the terminology should mean given the [Commission]'s mandate." The court then concluded:

But the body that determines the [Commission]'s mandate is the [Commission] and not this court. There is a mechanism in place for obtaining the [Commission]'s determination in evaluation of what its orders and rules mean. . . . This court is not authorized to substitute its judgment for that of the [Commission] as to what [the Commission] meant in its various orders establishing the methodology for collecting the municipal franchise fee.

         Because the plaintiffs had failed to have the Commission resolve the ambiguities in its own orders, the trial court found, the plaintiffs failed to exhaust their administrative remedies, and the trial court was, therefore, without jurisdiction of the subject matter.

         The plaintiffs appealed, and in Cazier, the Court of Appeals vacated the dismissal of the putative class action.[2] As to whether the plaintiffs were required to exhaust administrative remedies, the Court of Appeals looked principally to the Administrative Procedure Act (APA), OCGA § 50-13-1 et seq., which requires exhaustion when one aggrieved by an administrative decision seeks judicial review of that decision under the APA. See 339 Ga.App. at 508 (1). The Court of Appeals then reasoned that the putative class action did not seek judicial review under the APA, and the plaintiffs did not seek to challenge the applicable orders of the Commission:

Here, in contrast, petitioners do not claim to be aggrieved by any action of the [Commission], nor do they object to any decision or order of the [C]ommission. Instead, they contend that Georgia Power has violated the relevant orders of the [Commission] by failing to use the basis prescribed by the [C]ommission to calculate municipal franchise fees. . . . [T]here is no challenge to the validity or reasonableness of any utility rate set by the [C]ommission, and instead there is simply a challenge to the method of calculating and collecting the said fee.

Id. (citations and punctuation omitted). The Court of Appeals also looked to OCGA § 46-2-90, the basis for the statutory cause of action asserted by the plaintiffs against Georgia Power, and noted that this statute "does not contemplate any administrative proceedings before the [Commission] . . . but rather authorizes an action to recover damages 'in any court of competent jurisdiction' . . . ." Id. at 509 (1). From its examination of the APA and OCGA § 46-2-90, the Court of Appeals determined that the plaintiffs were not required to exhaust administrative remedies. See id. About the concern of the trial court that deciding the case would require the resolution of ambiguities in orders of the Commission, the Court of Appeals held that the trial court was perfectly competent to resolve those ambiguities. See id. at 509-510 (2). Although our analysis differs in some respects from that of the Court of Appeals, we affirm the judgment below.

         2. As a general rule, one aggrieved by an administrative decision must exhaust his administrative remedies before pursuing a judicial remedy. As the Court of Appeals correctly noted, the APA governs judicial review of orders of the Commission, see Georgia Power Co. v. Campaign for a Prosperous Ga., 255 Ga. 253, 255 (1) (336 S.E.2d 790) (1985), and it requires exhaustion of administrative remedies as a condition precedent to judicial review of an administrative decision under the APA. See Ga. Dept. of Community Health v. Ga. Society of Ambulatory Surgery Centers, 290 Ga. 628, 629 (724 S.E.2d 386) (2012) ("Under the APA, a person cannot seek judicial review of an agency action unless he has exhausted all administrative remedies available within the agency." (Citation and punctuation omitted)). The APA, however, is not the only source of the exhaustion doctrine. To the contrary, that doctrine predates the APA, [3] see, e.g., City Council of Augusta v. Loftis, 156 Ga. 77, 83 (1) (118 SE 666) (1923), and it sometimes applies in cases to which the APA does not. See, e.g., City of Suwanee v. Settles Bridge Farm, LLC, 292 Ga. 434, 437 (738 S.E.2d 597) (2013). Indeed, exhaustion is the usual rule whenever one aggrieved by an administrative decision seeks judicial relief of any sort from that decision, whether under the APA or in the form of an equitable remedy, see, e.g., Otwell v. West, 220 Ga. 95, 98 (1) (b) (137 S.E.2d 291) (1964), an extraordinary remedy, see, e.g., O'Callahan v. Aikens, 218 Ga. 46, 46 (3) (126 S.E.2d 212) (1962), or a declaratory judgment, see, e.g., Shelley v. Town of Tyrone, 302 Ga. 297, 303 (2) (806 S.E.2d 535) (2017).[4] And even when there is no administrative decision from which judicial relief is sought, the exhaustion doctrine applies as well when the merits of a lawsuit are committed to the exclusive jurisdiction of an administrative agency. See, e.g., First Union Nat. Bank of Ga. v. Independent Ins. Agents of Ga., 197 Ga.App. 227, 228 (1) (398 S.E.2d 254) (1990).

         Here, however, the plaintiffs do not seek judicial relief of any kind from the orders of the Commission. They do not dispute that the Commission may authorize the collection of municipal franchise fees, nor do they dispute the propriety or reasonableness of the particular methodology that the Commission has approved for the calculation of municipal franchise fees at issue in this case. Rather, the plaintiffs simply seek to recover damages for the collection of fees allegedly in excess of the amounts authorized by the orders of the Commission. To be sure, the plaintiffs and Georgia Power disagree about what the applicable orders require. That does not mean, however, that anyone is challenging the orders. If Georgia Power is right about what the orders require, then Georgia Power will win this case on the merits. But the case cannot properly be characterized as one in which the plaintiffs seek judicial relief from the orders of the Commission.

         Nor is this case one in which the merits are committed by law to the exclusive jurisdiction of the Commission. The Commission has "exclusive power to determine what are just and reasonable rates and charges to be made by any person, firm, or corporation subject to its jurisdiction." OCGA § 46-2-23 (a). See also Ga. Const. of 1983, Art. IV, Sec. I, Par. I (b) (the Commission "shall be vested with such jurisdiction, powers, and duties as provided by law"). The rate-making power of the Commission is legislative in nature, Georgia Power Co. v. Allied Chem. Corp., 233 Ga. 558, 558-559 (1) (212 S.E.2d 628) (1975), and as we have said before, "there will be no general regulation of rates by lawsuit." Campaign for a Prosperous Ga., 255 Ga. at 258 (2). Even so, the Commission already exercised its exclusive jurisdiction to set just and reasonable rates when it entered the orders authorizing Georgia Power to collect municipal franchise fees, and the plaintiffs do not dispute or seek relief from those orders. We fail to understand how a proper resolution of this putative class action would infringe upon the exclusive jurisdiction of the Commission to make just and reasonable rates for electrical service. Georgia Power points to no statute that squarely requires a plaintiff to exhaust administrative remedies before bringing a lawsuit like this one, and we find no principle of Georgia law that demands exhaustion here. See Hunnicutt v. Georgia Power Co., 168 Ga.App. 525, 526 (1) (309 S.E.2d 862) (1983) (decisions that hold it necessary to exhaust administrative remedies "are based upon statutes which by express terms or necessary implication give to the administrative board exclusive jurisdiction or which make the exhaustion of administrative remedies a condition precedent to judicial action" (citation and punctuation omitted; emphasis in original)).

         3. That said, there is no question that the merits of this lawsuit implicate the rate structure that the Commission has approved. After all, as Georgia Power argues and the trial court hinted, if the trial court were to misconstrue the applicable orders of the Commission, its resolution of the lawsuit then would be inconsistent with the policy determinations made by and committed by law to the exclusive jurisdiction of the Commission. Fortunately, as the plaintiffs note in their briefs, the law provides a mechanism by which the trial court can take care that its resolution of the case does not undercut the rate structure approved by the Commission.

         The trial court may permit the Commission to construe its own orders under the doctrine of "primary jurisdiction." Unlike the exhaustion doctrine, the doctrine of primary jurisdiction is a prudential, see Allco Renewable EnergyLtd. v. Mass. Electric Co., 875 F.3d 64, 74 (III) (1st Cir. 2017), and discretionary doctrine, see Tassy v. Brunswick Hosp. Ctr., 296 F.3d 65, 72 (2d Cir. 2002), and it does not require the outright dismissal of a ...


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