Thomas N. Hanna, Esq. Leonard Knee, Esq.
Charleston, West Virginia Charles B. Dollison, Esq.
Attorney for the Appellant Bowles Rice McDavid Graff & Love
Charleston, West Virginia
Lisa L. Wansley, Esq. Attorneys for Morgan Sanitation &
Charleston, West Virginia Recycling Corporation
Attorney for the Public Service
The Opinion of the Court was delivered PER CURIAM.
1. "'"'[A]n order of the public service commission based upon its finding
of facts will not be disturbed unless such finding is contrary to the evidence, or is without
evidence to support it, or is arbitrary, or results from a misapplication of legal principles.'
United Fuel Gas Company v. The Public Service Commission, 143 W.Va. 33, 99 S.E.2d 1
(1957)." Syllabus Point 5, in part, Boggs v. Public Service Comm'n, 154 W.Va. 146, 174
S.E.2d 331 (1970).' Syllabus Point 1, Broadmoor/Timberline Apartments v. Public Service
Commission, 180 W.Va. 387, 376 S.E.2d 593 (1988)." Syl. Pt. 1, Sexton v.Public Service
Comm'n, 188 W. Va. 305, 423 S.E.2d 914 (1992).
2. "In reviewing a Public Service Commission order, we will first
determine whether the Commission's order, viewed in light of the relevant facts and of the
Commission's broad regulatory duties, abused or exceeded its authority. We will examine
the manner in which the Commission has employed the methods of regulation which it has
itself selected, and must decide whether each of the order's essential elements is supported
by substantial evidence. Finally, we will determine whether the order may reasonably be
expected to maintain financial integrity, attract necessary capital, and fairly compensate
investors for the risks they have assumed, and yet provide appropriate protection to the
relevant public interests, both existing and foreseeable. The court's responsibility is not to
supplant the Commission's balance of these interests with one more nearly to its liking, but
instead to assure itself that the Commission has given reasoned consideration to each of the
pertinent factors." Syl. Pt. 2, Monongahela Power Co. v. Public Service Comm'n, 166
W.Va. 423, 276 S.E.2d 179 (1981).
3. "This Court will not substitute our judgment for that of the Public
Service Commission on controverted evidence." Syl. Pt. 2, Chesapeake and Potomac
Telephone Co. v. Public Service Comm'n, 171 W. Va. 494, 300 S.E.2d 607 (1982).
This is an appeal by Bebe Enterprises, Inc. (hereinafter "Appellant"), from a
February 21, 1996, order of the West Virginia Public Service Commission (hereinafter
"PSC") denying the Appellant's request to add territory to its existing garbage collection
route in McDowell County. The Appellant contends that the PSC's denial of its request was
based upon a misapplication of legal principles. We affirm the decision of the PSC.
On March 13, 1995, Eddie Hairston, d.b.a. Hairston Garbage Disposal
Hairston (hereinafter "Hairston") filed an application with the PSC for transfer of Hairston's
authority for a particular subject territory in McDowell County to another hauling company,
Morgan Sanitation (hereinafter "Morgan").(1) The Appellant protested this transfer, as did
other area carriers. On March 15, 1995, the Appellant sought to amend its own common
carrier certificate to include authority to provide service to the area formerly served by
Hairston.(2) Hairston and Morgan then protested the Appellant's application to serve these
On June 22, 1995, Administrative Law Judge Miles C. Cary held a hearing on
the proposed transfer of territory from Hairston to Morgan. Mr. Thomas Hanna, attorney for
the Appellant, was present. Based upon an agreement between Morgan and the Appellant
regarding the transfer language, the Appellant withdrew its protest. The additional agreed-upon language provided: "and excluding all points going north on Route 161 that are more
than one-half mile by road from the intersection of Route 103 and Route 161."
On August 8, 1995, Administrative Law Judge Cary issued a recommended
decision approving the transfer of the territory from Hairston to Morgan, as amended
pursuant to agreement between Morgan and the Appellant. Final approval of this transfer
was delayed until February 6, 1996, due to intervention of commission staff members in an
attempt to obtain clarification of language contained in the new Morgan certificate regarding
Routes 103 and 161.
On August 18, 1995, Administrative Law Judge Robert W. Glass held a
hearing on the Appellant's application for the territory. The Appellant introduced evidence
regarding the inadequacy of Hairston's service, contending that approximately 200 of
Hairston's customers had apparently been taken over by Appellant and twenty-five
customers had been assumed by Morgan. Even the city of Gary, West Virginia, apparently
took over some of the service for Hairston's 520 customers. Public Service Commission
utility inspector Mr. Charles Dyer also testified that the PSC had received numerous
complaints about Hairston's service from 1993-1995. Those complaints alleged decreased
significantly when Morgan began servicing Hairston's customers.
Morgan was permitted to participate in the August 18, 1995, hearing due to its
status as intervenor in the matter, and it presented the testimony of two customers formerly
served by Hairston. Each customer testified that she was satisfied with Morgan's service.
On August 21, 1995, Morgan withdrew its request for emergency certification for the area.
On August 23, 1995, Thornton Cooper, Deputy Director of Transportation
Division, filed a motion to intervene and also filed exceptions to the August 9, 1995,
recommended order of Administrative Law Judge Cary. Mr. Cooper expressed concern that
although the parties may have understood the language and intent of the amended section,
that section was ambiguous. On September 5, 1995, counsel for Morgan, Leonard Knee,
filed a map depicting the intent of the parties regarding the areas surrounding Routes 103 and
161. On September 13, 1995, Mr. Cooper recommended that those route numbered areas
be referenced as certain territory rather than a road route number.
On November 9, 1995, Administrative Law Judge Glass issued a recommended
order denying the Appellant's application to serve the area in question. The order stated that
the Appellant had not "met its burden to show that there exists in the area of the amendment
a need for additional trash service that is not being adequately and efficiently provided by
the presently certificated trash haulers serving the area." However, the order also recognized
that the transfer of authority from Hairston to Morgan had not yet been approved and was
then pending. The Appellant filed exceptions to Administrative Law Judge Glass' order on
November 27, 1995.
On February 6, 1996, the territory in question was transferred from Hairston
to Morgan, and Hairston was paid $10,000. The PSC approved the transfer as amended by
Morgan/Bebe agreement and including the territory restatement by Mr. Cooper and his staff,
as referenced above. By order dated February 21, 1996, the PSC reiterated the November
9, 1995, recommended order denying the Appellant's application. On March 22, 1996, the
Appellant filed its petition with this Court.
This Court's standard of review with respect to this matter was enunciated in syllabus point one of Sexton v. Public Service Commission, 188 W. Va. 305, 423 S.E.2d 914 (1992), as follows:
"'"[A]n order of the public service commission based
upon its finding of facts will not be disturbed unless such
finding is contrary to the evidence, or is without evidence to
support it, or is arbitrary, or results from a misapplication of
legal principles." United Fuel Gas Company v. The Public
Service Commission, 143 W.Va. 33, 99 S.E.2d 1 (1957).'
Syllabus Point 5, in part, Boggs v. Public Service Comm'n, 154
W.Va. 146, 174 S.E.2d 331 (1970)." Syllabus Point 1,
Broadmoor/Timberline Apartments v. Public Service
Commission, 180 W.Va. 387, 376 S.E.2d 593 (1988).
The Appellant asserts that the PSC was clearly wrong in denying its request
for an amendment to expand service to the area in question. The Appellant further asserts
that Morgan, an existing carrier serving without PSC authority, should not be permitted to
use evidence of its adequate service to prevent a prospective applicant for the same territory
from obtaining a certificate for the territory. The Appellant also contends that the PSC was
presented with two separate and distinct matters, which the PSC then inappropriately
combined. Morgan's case regarded transfer while the Appellant's case dealt with adequacy
of existing services. The Appellant contends that the matters were not proper for
consolidation because they involved different inquiries and that the PSC did not adequately
address the issues raised by the Appellant.
West Virginia Code 24A-2-5(a) - (c) (1992) provides the requirements for a certificate of convenience and necessity and establishes that a common carrier may obtain a certificate from the PSC by filing an application and by participating in a hearing procedure. Subsection (a) of the statute provides, in pertinent part, as follows:
[I]f the commission finds from the evidence that the public
convenience and necessity require the proposed service or any
part thereof, it shall issue the certificate as prayed for, or issue
it for the partial exercise only of the privilege sought, and may
attach to the exercise of the right granted by such certificate
such terms and conditions as in its judgment the public
convenience and necessity may require, and if the commission
shall be of the opinion that the service rendered by any common
carrier holding a certificate of convenience and necessity over
any route or routes in this state is in any respect inadequate or
insufficient to meet the public needs, such certificate holder
shall be given reasonable time and opportunity to remedy such
inadequacy or insufficiency before any certificate shall be
granted to an applicant proposing to operate over such route or
routes as a common carrier. Before granting a certificate to a
common carrier by motor vehicle the commission shall take into
consideration existing transportation facilities in the territory for
which a certificate is sought, and in case it finds from the
evidence that the service furnished by existing transportation
facilities is reasonably efficient and adequate, the commission
shall not grant such certificate.
Subsection (b) of that statute provides that the burden of proof shall be upon the applicant
in establishing that public convenience and necessity do exist. Subsection (c) explains that
a certificate may be assigned or transferred with the approval of the commission.
Morgan maintains that the PSC's decision is legally correct and justified by
the evidence. Morgan presented two witnesses who testified that they were already receiving
adequate service from Morgan. The Appellant was, according to Morgan's argument, unable
to prove that its services were needed in the area. Morgan also maintains that the Appellant
was present at the hearing granting Hairston's area to Morgan and that no exceptions were
filed to the recommended decision or final order granting Hairston's territory to Morgan.
The PSC contends that the Appellant misinterprets West Virginia Code 24A-2-5 and that the PSC is not required to grant an amendment where collection currently
provided is inadequate. The PSC further emphasizes that the burden of proof in a transfer
case (Hairston's transfer to Morgan) is lower than the burden of proof in an application
matter such as that initiated by the Appellant. Transfer cases simply require evidence of the
transferee's fitness while application cases require evidence of public convenience and
In Solid Waste Services of West Virginia v. Public Service Commission, 188 W. Va. 117, 422 S.E.2d 839 (1992), we reiterated that "'[t]he chief inquiry at a transfer hearing is the ability of the proposed new certificate holder to carry on the business.'" Id. at 119, 422 S.E.2d at 841, quoting Syl. Pt. 2, Chabut v. Public Service Comm'n, 179 W.Va. 111, 365 S.E.2d 391 (1987). The rule governing the PSC's examination of applications for approval of transfer provides as follows:
Upon an application for approval of the transfer and
assignment of a certificate or permit, the certificate or permit
holder, i.e., transferor, and the transferee, i.e., the person
seeking to acquire said certificate, shall appear at the hearing.
The transferor should be prepared to testify as to the nature and
extent of his operation under the certificate sought to be
transferred that he has actively been operating under the
certificate and that the certificate is not otherwise dormant. The
transferee should be prepared to show that he is financially able
to provide the service, that he has the experience and the
necessary equipment to provide the proposed service, that he is
able to secure proper liability insurance on all motor vehicles to
be operated, and should give a general description of his
10 C.S.R. Sec. 150-1-26IV(b)(1) at 21. Paraphrasing that rule in Solid Waste Services, we explained as follows:
In other words, at the PSC hearing the transferor is to describe
what he does, and the transferee is supposed to describe how he
can properly provide the existing level of service. This
provision was designed to allow permits to be freely transferred
so long as the entity acquiring the permits is capable of
continuing the existing level of service. Unless the PSC finds
that the acquiring party cannot meet the current level of service,
the PSC has no grounds to deny the permit transfer.
188 W. Va. at 119, 422 S.E.2d at 841.
In syllabus point two of Monongahela Power Company v. Public Service Commission, 166 W.Va. 423, 276 S.E.2d 179 (1981), we concisely defined our role in reviewing PSC decisions, as follows:
In reviewing a Public Service Commission order, we will
first determine whether the Commission's order, viewed in light
of the relevant facts and of the Commission's broad regulatory
duties, abused or exceeded its authority. We will examine the
manner in which the Commission has employed the methods of
regulation which it has itself selected, and must decide whether
each of the order's essential elements is supported by substantial
evidence. Finally, we will determine whether the order may
reasonably be expected to maintain financial integrity, attract
necessary capital, and fairly compensate investors for the risks
they have assumed, and yet provide appropriate protection to the
relevant public interests, both existing and foreseeable. The
court's responsibility is not to supplant the Commission's
balance of these interests with one more nearly to its liking, but
instead to assure itself that the Commission has given reasoned
consideration to each of the pertinent factors.
In syllabus point two of Chesapeake and Potomac Telephone Company v. Public Service Commission, 171 W. Va. 494, 300 S.E.2d 607 (1982), we explained that "[t]his Court will not substitute our judgment for that of the Public Service Commission on controverted evidence." We emphasized that "[t]his does not mean that this Court will not make a searching and careful inquiry into the facts, but only that we will not substitute our judgment for that of the Commission." Id. at 488, 300 S.E.2d at 611.
This matter presents a unique situation in which two separate requests were
made for territory no longer being served by Hairston. As the Appellant underscores, the
service initiated by Morgan prior to the PSC's consideration of the formal transfer from
Hairston to Morgan was not PSC approved. In the February 6, 1996, order transferring
authority to Morgan, the PSC states, "Our decision to approve the transfer in this case has
not been influenced by the fact that Morgan assumed responsibility for a large part of
Hairston territory after Hairston ceased operations." The PSC was simply presented with
two choices: (1) approval of a transfer from Hairston to Morgan, as proposed by both
Hairston and Morgan, or (2) approval of an application for amendment of the Appellant's
certificate to include the area served by Hairston. The PSC recognized Morgan's initially
unapproved service to Hairston customers, yet the PSC concluded that Morgan was the
appropriate recipient of the authority formerly enjoyed by Hairston. Upon consideration of
this matter, we do not find that conclusion to be unreasonable.
Based upon the foregoing, we affirm the decision of the Public Service
1. This procedure was technically considered a transfer matter for purposes of determining burden of proof among various carriers seeking the territory.
2. This procedure was technically considered an application matter for purposes of determining burden of proof among the carriers seeking this territory.
3. On March 16, 1995, Morgan filed an application with the PSC for a certificate and emergency authority to serve Hairston's territory. This application was withdrawn at Morgan's request on August 21, 1995.