Appeal from the Opinion and Order of the Commonwealth Court of Pennsylvania, at No. 2987 C.D. 1983, which affirmed the Order of the Pennsylvania Public Utility Commission, at A-00104457. No. 74 M.D. Appeal Docket 1984,
Nix, C.j., and Larsen, Flaherty, McDermott, Zappala and Papadakos, JJ. Hutchinson, J., did not participate in the consideration or decision of this case. Nix, C.j., filed a concurring opinion.
On August 18, 1953, Fairview Water Company (Fairview) and Pennsylvania Power & Light Company (PP & L) entered into an agreement requiring Fairview to convey a right-of-way to PP & L for construction of an aerial electric transmission line across Fairview's property in Monroe County. After the line was installed, it was discovered that this line was not constructed in the area covered by the easement. To rectify this problem the parties entered into a 30-year lease on June 13, 1955 which allowed PP & L to maintain the line as constructed. This lease agreement was made retroactive to July 1, 1953 with a termination date of July 1, 1983.
By the terms of the lease, PP & L was granted the option to renew for an additional period of five years, subject to Fairview's right to terminate the original lease by giving
PP & L one year's advanced notice of the original expiration date. On September 13, 1976, Fairview formally notified PP & L of its intent to terminate the lease on July 1, 1983.
In response to this notice, PP & L filed an application under the Act of May 5, 1933, P.L. 364, as amended, 15 P.S. § 1322 with the Pennsylvania Public Utility Commission (PUC) requesting a finding and determination that its electric transmission line was necessary and proper for the service, accommodation, convenience or safety of the public.
After hearing and argument, the Administrative Law Judge issued his initial decision granting PP & L's application. In so doing, the Administrative Law Judge determined that the service was necessary and proper and also determined the scope and validity of the easement. The decision was subsequently adopted by the PUC and affirmed by Commonwealth Court. In affirming the PUC, the Commonwealth Court held that the Eminent Domain Code, Act of June 22, 1964, Special Sess., P.L. 84, as amended, 26 P.S. §§ 1-101 -- 1-901, is not applicable, "when a condemnee challenges the taking of an easement or right-of-way." 83 Pa. Commw. 627, 629, 479 A.2d 20, 22 (1984). The Commonwealth Court interpreted Section 1322(C) under which the application was made as simply limiting the preliminary phase of the hearing on the petition to a determination of the necessity of the service. The PUC's determination of scope and validity under Section 1322(C) is reserved until this initial necessity of service phase is completed. According to Commonwealth Court, the reason for this bifurcation was to prevent jurisdictional issues from clouding the preliminary determination of necessity. Thus, once the Administrative Law Judge determined that the proposed service was necessary and proper, he had authority to continue taking evidence on the petition to determine the specific scope and validity issues raised by the condemnee. This he did in his findings of fact and conclusions of law. For the reasons set forth hereinafter, we reverse.
The issue before us is in what forum may a condemnee challenge the legality of a taking when a public utility attempts to condemn a less-than-fee interest in property and the PUC has determined that the subject property is necessary for the utility service. This precise issue presents a question of first impression although we have previously addressed similar issues.*fn1 Most recently we have decided that a court of equity may determine the validity and scope of a taking of a less-than-fee interest by a utility company. Redding v. Atlantic City Electric Company, 440 Pa. 533, 269 A.2d 680 (1970). However, in Redding we did not decide whether the PUC also has such power and more specifically whether such power is founded in Section 1322(C). This determination rests upon the interpretation of the following language:
C. The powers conferred by subsection A of this section may be exercised to condemn property outside the limits of any line of railroad, street railway, street, highway, water or other public way or place for the purpose of erecting poles or running wires or other aerial electric, intrastate aerial telephone or intrastate aerial telegraph facilities only after the Pennsylvania Public Utility Commission, upon application of such public utility corporation, shall have found and determined, after notice and opportunity for hearing that the service to be furnished by said corporation through the exercise of said power is necessary or proper for the service, accommodation, convenience or safety of the public. The power of the public utility corporation to condemn the subject property or the procedure followed by it shall not be an issue in the commission proceedings held hereunder and notwithstanding section 1111 of the Public Utility Law neither the Commonwealth Court, the Court of Common Pleas of Dauphin County nor any other court of common pleas shall entertain any proceeding questioning the jurisdiction of the commission under this subsection. A final order of
the commission approving or denying an application under this subsection, including an order involving a question of jurisdiction hereunder, may be made the ...