99-004264RX Florida Power And Light Corporation vs. Public Service Commission Status: Closed Settled and/or Dismissed prior to entry of RO/FO on Wednesday, November 3, 1999.

Summary: Where rule challenge was actually an attack on the erroneous application of the rule, dismissal of case appropriate.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA POWER & LIGHT )

COMPANY, )

)

Petitioner, )

)

vs. ) Case No. 99-4264RX

)

PUBLIC SERVICE COMMISSION, )

)

Respondent. )

______________________________)

FINAL ORDER

This cause came before the undersigned on a Motion to

Dismiss filed on October 27, 1999, by Respondent, Public Service

Commission (PSC). By its motion, the PSC moves for the dismissal

of a rule challenge by Petitioner, Florida Power & Light Company

(FPL), which seeks a determination that Rule 25-22.036(3),

Florida Administrative Code, is invalid on numerous statutory

grounds. A response in opposition to the motion was filed by FPL

on October 29, 1999. Oral argument on the motion is unnecessary.

Having considered the motion and response, the motion is granted

for the following reasons.

For purposes of ruling on the motion, the relevant

allegations in FPL's petition have been accepted as being true.

They reflect that on December 15, 1998, as later clarified by

Orders entered on April 20, May 21, July 1, and September 2,

1999, the PSC initiated an "adjudicatory proceeding" for the

purpose of investigating "planned, aggregate electric utility

reserve margins in peninsular Florida"; that the proceeding "will

be treated as a contested docket involving disputed issues of

material fact and conducted pursuant to [S]ections 120.569 and

120.57, Florida Statutes, and rule chapter 28-106, Florida

Administrative Code"; and that FPL's substantial interests will

be affected by that proceeding.

In a preliminary ruling entered on July 1, 1999, a

Commissioner serving as a Prehearing Officer cited as the source

of authority for instituting the proceeding Rule 25-22.036(3),

Florida Administrative Code, the rule under challenge. This

ruling was confirmed by the full Commission by Order dated

September 2, 1999. The challenged rule reads as follows:

Orders and Notices. Upon its own motion, the

Commission may issue an order or notice

initiating a proceeding. Such order or

notice shall be served upon all persons named

therein. The Commission may also transmit

notice of its action to other persons

requesting such notice, and may publish such

notice in appropriate newspapers of general

circulation and the Florida Administrative

Weekly.

FPL contends that in order to initiate a formal proceeding

under Sections 120.569 and 120.57(1), Florida Statutes, the PSC

must rely on the Uniform Rules of Procedure as its source of

authority, and specifically those found in Chapter 28-106,

Florida Administrative Code. This is because pursuant to Section

120.54(5)(a)1., Florida Statutes, effective July 1, 1998, the

Uniform Rules of Procedure replaced the PSC's prior procedural

rules by operation of law, unless an exception had been granted

by the Administration Commission. Dep't of Corrections v.

Saulter , 24 Fla. L. Weekly D1951 (Fla. 1st DCA, August 20, 1999)

("[b]y July 1, 1998, all agencies had to follow the Uniform Rules

of Procedure, rather than procedural rules specific to any

particular agency, unless an exception had been granted by the

Governor and Cabinet, sitting as the Administration Commission").

The PSC's request for an exception for the challenged rule was

denied by the Administration Commission on June 25, 1998.

Therefore, FPL contends that the challenged rule may only be used

to initiate "agency investigations preliminary to agency action,"

which are neither subject to the requirements of Sections 120.569

or 120.57, Florida Statutes, nor to the Uniform Rules of

Procedure, and which may not culminate in an adjudication of

FPL's rights. Because the PSC has unlawfully used the rule to

initiate a formal proceeding under Sections 120.569 and

120.57(1), Florida Statutes, FPL asserts that the rule is invalid

for numerous reasons.

In its Motion to Dismiss, the PSC argues that the rule

challenge should be dismissed on various grounds, only one of

which is pertinent to this discussion. As to that ground, the

PSC contends that FPL is merely complaining that the PSC is

incorrectly applying the rule, and that this type of claim can be

properly lodged during the course of the formal proceeding now

pending before the PSC, or in an appeal from any final agency

action.

Although the petition challenges the validity of the rul e on

the grounds it violates Section 120.52(8), Florida Statutes, in

seven respects, the gravamen of FPL's complaint is that the PSC

has used the rule in an erroneous way. More specifically, the

petition alleges that "the PSC is illegally relying on [the rule]

to initiate and conduct an adjudicatory proceeding intended to

affect [FPL's] substantial interests pursuant to [S]ections

120.569 and 120.57, Florida Statutes."

Since at least 1984, the courts have held that "the remedy

for an erroneous application of [a rule] is a proceeding pursuant

to Section 120.57." Hasper v. Dep't of Admin. , 459 So. 2d 398,

400 (Fla. 1st DCA 1984). See also Beverly Health and Rehab.

Servs., Inc. v. Agency for Health Care Admin. , 708 So. 2d 606

(Fla. 1st DCA 1998) (where the substance of a rule challenge is

to attack the application of a rule, dismissal of the petition is

appropriate).

"The fact that an agency may wrongfully or erroneously apply

[a rule] in any given situation does not invalidate the [r]ule."

Hasper at 400. Thus, accepting as true FPL's allegation that the

PSC has erroneously used the rule in lieu of the Uniform Rules of

Procedure, this does not invalidate the regulation. Even under

FPL's narrow interpretation of the rule, the PSC can still use

it, in a legitimate way, to initiate "agency investigations

preliminary to agency action" under Section 120.57(5), Florida

Statutes.

Without saying so specifically in its response to the

motion, but perhaps in an effort to distinguish the Hasper case,

FPL points out that in at least two orders entered in the pending

PSC case, the PSC has construed the rule as legal authority to

initiate a formal proceeding on its own motion whenever it

executes its statutory duties.

Whether the PSC will choose to rely upon the rule in this

manner in any or all future cases is speculative at best. Such

an interpretation is hardly surprising, however, since any other

would be a clear admission by the PSC that the rule had been

improperly applied. In any event, Hasper makes clear that FPL's

"remedy for an erroneous application of Rule [25-22.036(3)]" is a

proceeding pursuant to Sections 120.569 and 120.57, Florida

Statutes, and if unsuccessful in that forum, an appeal to the

Supreme Court once final agency action has been taken. Id. at

400.

For the reasons expressed above, the Motion to Dismiss

should be granted. This ruling renders moot a pending Corrected

Petition for Leave to Intervene filed by Florida Power

Corporation and a response in opposition to that petition filed

by the PSC. It is also unnecessary to decide whether the PSC

acted properly in this instance, or whether its interpretation of

Rule 25-22.036(3), Florida Administrative Code, is correct.

Finally, the final hearing on the merits of the case is hereby

cancelled. It is, therefore,

ORDERED that the Public Service Commission's Motion to

Dismiss the Petition for Administrative Determination of the

Invalidity of an Existing Rule filed by Florida Power & Light

Company is granted, and the petition is dismissed, with

prejudice.

DONE AND ORDERED this 3rd day of November, 1999, in

Tallahassee, Leon County, Florida.

___________________________________

DONALD R. ALEXANDER

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone] SUNCOM 278-9675

Fax Filing [phone]

www.doah.state.fl.us

Filed with Clerk of the

Division of Administrative Hearings

this 3rd day o f November, 1999.

COPIES FURNISHED:

Matthew M. Childs, Esquire

Donna E. Blanton, Esquire

Steel, Hector & Davis LLP

215 South Monroe Street, Suite 601

Tallahassee, Florida 32301

Mary Anne Helton, Esquire

Public Service Commission

2540 Shumard Oak Boulevard

Tallahassee, Florida 32399-0850

Blanca Bayo, Director of Records

Public Service Commission

2540 Shumard Oak Boulevard

Tallahassee, Florida 32399-0850

V. Carroll Webb, Executive Director

Joint Administrative Procedures Committee

Holland Building, Room 120

Tallahassee, Florida 32399-1300

Liz Cloud, Chief

Bureau of Administrative Code

The Elliott Building

Tallahassee, Florida 32399-0250

NOTICE OF RIGHT TO JUDICIAL REVIEW

A party who is adversely affected by this final order is entitled

to judicial review pursuant to Section 120.68, Florida Statutes.

Review proceedings are governed by the Florida Rules of Appellate

Procedure. Such proceedings are commenced by filing one copy of

the notice of appeal with the agency clerk of the Division of

Administrative Hearings and a second copy, accompanied by filing

fees prescribed by law, with the District Court of Appeal, First

District, or with the district court of appeal in the appellate

district where the party resides. The notice of appeal must be

filed within 30 days of rendition of the order to be reviewed.