Carolina Power v. Lynches Electric

THIS OPINION
HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT
IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 239(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA

In The Court of Appeals

Carolina Power & Light Company,       
Respondent,

v.

Lynches River Electric Cooperative, Inc.,       
Appellant.

Appeal From Chesterfield County

J. Michael Baxley, Circuit Court Judge

Unpublished Opinion No. 2004-UP-247

Heard March 11, 2004 – Filed April 15,
2004

AFFIRMED

Marcus A. Manos and J. David Black, both of Columbia, and
Thomas H. Pope, III, of Newberry, for Appellant. 

Mark W. Buyck, Jr., and Mark W. Buyck, III, both of Florence,
for Respondent.

PER CURIAM:  Carolina Power & Light
brought this declaratory judgment action against Lynches River Electric Cooperative
seeking a declaration of rights regarding the provision of electric service
to a Bi-Lo supermarket in the Town of Pageland.  Lynches River appeals the trial
court’s grant of summary judgment to CP&L.  We affirm.

FACTS

Since 1925, CP&L and its predecessor
have provided electric service to the residents of the Town of Pageland.  Lynches
River began offering electric service in 1939.  In 1949, the Town of Pageland
extended its one-half mile radius boundary by annexing land within a radius
of one mile from the center of town.  The newly annexed area included electric
utility lines owned by both CP&L and Lynches River.  CP&L, however,
has always been the principal supplier of electricity to the town. 

In May of 1981, the town granted CP&L
an indeterminate permit to provide electric service to the residents.  Since
at least 1990, Lynches River has provided electric service to tenants in a strip
mall, including Bi-Lo.  The structure was located outside the original town
boundary, but inside the annexed area.  Lynches River has also provided electric
service to the parking lot adjacent to the structure.  CP&L has not challenged
Lynches River’s right to continue service to the strip mall. 

In 2001, Bi-Lo began construction on a
new store located across the parking lot from the existing structure.  The new
structure is located entirely within the original town limits.  The same developer
owns the property upon which both structures are located. 

Lynches River and Bi-Lo entered into a contract
for electrical service on the new building.  Lynches River offered electrical
service to the new structure through a distribution point near the existing
structure’s distribution point.  The distribution points are within the annexed
area of the town and not within the original boundary. 

CP&L, upon learning that Lynches River was
providing the electrical service to the new structure, filed this claim for
a declaratory judgment.  CP&L filed a motion for summary judgment, claiming
Lynches River could not serve electricity in the original town boundaries because
it is not a rural area and Lynches River failed to meet any of the exceptions
allowing it to provide electrical service inside the town.  CP&L presented
the figure from the 2000 United States Census showing the population was 2,521. 

Lynches River filed its own motion for
summary judgment, asserting the population was below 2,500 and it could continue
service to the new structure because it served the existing structure.  Lynches
River presented an affidavit by the mayor of the Town of Pageland, which stated
it was the mayor’s belief that the population had dropped below 2,500. 

The trial court determined the mayor’s
affidavit was insufficient to create a genuine issue of material fact as to
the population of the town, and that Lynches River did not meet any of the exceptions
of S.C. Code Ann. § 33-49-250 (1990) which would allow it to provide electrical
service to the new structure.  The trial court distinguished the case of Carolina
Power & Light Co. v. City of Bennettsville, 314 S.C. 137, 442 S.E.2d
177 (1994), finding the point of delivery to the new structure is not in a rural
area, but within the town limits.  Accordingly, the trial court granted summary
judgment to CP&L. 

STANDARD OF REVIEW

In reviewing the grant of a summary judgment motion,
this court applies the same standard which governs the trial court:  summary
judgment is proper when “there is no genuine issue as to any material fact and
. . . the moving party is entitled to judgment as a matter of law.”  Rule 56(c),
SCRCP; Baughman v. American Tel. & Tel. Co., 306 S.C. 101, 114-15,
410 S.E.2d 537, 545 (1991).  “In determining whether any triable issues of fact
exist, the evidence and all inferences which can be reasonably drawn from the
evidence must be viewed in the light most favorable to the nonmoving party.” 
Strother v. Lexington County Recreation Comm’n, 332 S.C. 54, 61,
504 S.E.2d 117, 121 (1998).  “On appeal from an order granting summary judgment,
the appellate court will review all ambiguities, conclusions, and inferences
arising in and from the evidence in a light most favorable to the non‑moving
party below.”  Osborne v. Adams, 346 S.C. 4, 7, 550 S.E.2d 319, 321 (2001).

LAW/ANALYSIS

The Rural Electric Cooperative Act (RECA) permits
the formation of nonprofit cooperatives “for the purpose of supplying electric
energy and promoting and extending the use thereof in rural areas.”  S.C. Code
Ann. § 33-49-210 (1990). [1]   As creatures of statute, rural
electric cooperatives “only have such authority as the legislature has given
them.”  Duke Power Co. v. Laurens Elec. Co-op., Inc., 344 S.C. 101, 104,
543 S.E.2d 560, 562 (Ct. App. 2001).  They may only serve rural areas, that
is, areas where the population is less than 2,500 persons.  S.C. Code Ann. §
33-49-250(1) (1990).  RECA permits a cooperative to serve non-rural areas under
two exceptions:  (1) the cooperative may continue to provide electrical service
to a town in which it is the principal electrical provider, and (2) the cooperative
may continue to serve premises it served at the time the area was annexed into
the town, and until directed otherwise by the local governing body, it may serve
other premises within the same area.  Id.

“Both exceptions prevent the ouster of co-ops from
areas they have historically served due to population growth or annexation.” 
Duke Power, 344 S.C. at 105, 543 S.E.2d at 562.  The statutory language,
therefore, “contemplate[s] [a] co-op’s continued service” in an area to which
an exception applies.  Id.

I.       Affidavit Regarding Population of the Town of Pageland

Lynches River asserts the trial court
improperly attributed no weight to the affidavit of Pageland’s mayor, Carroll
Faile, in regards to the town’s population.  Lynches River argues the affidavit
is sufficient to create a genuine issue of material fact regarding whether Lynches
River has the right to provide electric service because the population has fallen
below 2,500 people.  We disagree. 

Rule 56(e), SCRCP, states:  “Supporting
and opposing affidavits shall be made on personal knowledge, shall set forth
such facts as would be admissible in evidence, and shall show affirmatively
that the affiant is competent to testify to the matters stated therein.”  Neither
the trial court nor this court are “required to single out some one morsel of
evidence and attach to it great significance when patently the evidence is introduced
solely in a vain attempt to create an issue of fact that is not genuine.”  Main
v. Corley, 281 S.C. 525, 527, 316 S.E.2d 406, 407 (1984). 

In his affidavit, the mayor identified himself
as the town’s mayor and a resident of the county, asserted he was familiar with
the town’s economic conditions and its population trends over the last twenty
years, and stated that given the recent economic downturn and the downward population
downtrend, he believed and opined that the town’s population was on the decrease
and had fallen below 2,500. 

In Englert, Inc. v. Netherlands Ins.
Co., this court determined an affiant’s status as the vice-president of
the company was insufficient to demonstrate he had personal knowledge of the
contract and job performed in that case.  Englert, 315 S.C. 300, 304,
433 S.E.2d 871, 874 (Ct. App. 1993).  As in Englert, the mayor’s affidavit
fails to provide sufficient admissible evidence to support his belief.  Although
the mayor states he is familiar with the situation in Pageland, his affidavit
is not based on personal knowledge, but is only an opinion based on his belief
that the town’s population had decreased.  The mayor did not, and obviously
could not, state he knew the exact population of the town.  Accordingly, the
trial court correctly refused to give this “morsel” of information such significance
as to create a genuine issue of fact regarding the town’s population.

Because the only properly admitted evidence regarding
the town’s population—the 2000 United States Census—established the population
was 2,521, Lynches River can only service areas within the town if it falls
under one of the exceptions mentioned above and discussed below.

II.     Other Exceptions

Lynches River has not contended it is
the principal supplier of electricity in the Town of Pageland and is thus not
entitled to provide service inside the town under that exception.

The only other exception that could apply
is the annexation exception that would allow Lynches River to continue servicing
premises being served at the time of the annexation of an area into the town
or additional premises within the annexed area until the town directs otherwise. 

Lynches River contends the existing structure
and the new structure occupy a single premises because they sit on a single
tract owned by the same developer.  Although the statute permits the cooperative
to service all premises it served prior to the annexation and all premises in
that area until instructed otherwise, it specifically states the cooperative
“shall not extend service to any premises in any other part of such city or
town” where, as here, it is not the town’s principal electrical provider.  See
§ 33-49-250(1).  Here, the new structure is entirely within the original town
limits, an area in which Lynches River has no right to provide service.

Although not directly applicable to the
definition of “premises” in section 33-49-250, S.C. Code Ann. § 58-27-610 (1976)
defines the term for purpose of that article, which involves the service rights
of electric suppliers:

(2) The term “premises” means the building, structure
or facility to which electricity is being or is to be furnished; provided,
that two or more buildings, structures or facilities which are located on one
tract or contiguous tracts of land and are utilized by one electric consumer
for farming, business, commercial, industrial, institutional or governmental
purposes, shall together constitute one “premises,” except that any such
building, structure or facility shall not, together with any other building,
structure or facility, constitute one “premises” if the electric service to
it is separately metered and the charges for such service are calculated independently
of charges for service to any other building, structure or facility.

(Final emphasis added.)

In the instant case, the existing structure
and the new structure are located on one tract of land.  However, they will
be separately metered and the calculation of the electricity consumed by and
billed for the existing structure will be separate from that consumed by and
billed for the new structure.  As such, they are considered two separate premises
even though they are situated on the same tract of land. Accordingly, the trial
court correctly concluded Lynches River may not provide service to the new structure.

III.    Carolina Power & Light v. City of Bennettsville

Lynches River argues the holding in Carolina
Power & Light Co. v. City of Bennettsville, 314 S.C. 137, 442 S.E.2d
177 (1994), applies to its situation because the point of distribution to the
new structure lies in the annexed area and outside the original town limits. 
In Bennettsville the court held a cooperative could provide service that
was distributed to a point in a rural area even though it was ultimately consumed
within the city limits.  Id. at 139-40, 442 S.E.2d at 179.

In this case, the distribution point is a new distribution
point located in an annexed area of the Town of Pageland, not a rural area as
in Bennettsville.  Even though the distribution point in this case is
in the annexed area, where Lynches River has the right to continue to provide
service to existing premises, there was a new connection created which
was not authorized by statute.  Accordingly, the Bennettsville
case is not controlling and the trial court correctly declined to rely upon
its holding.

AFFIRMED.

HUFF and STILWELL, JJ., and CURETON, A.J., concur.

[1]        Sections 33-49-210 and 33-49-250 have been recently amended
by Act No. 179, 2004 S.C. Acts ___.  The amendments do not affect the outcome
of this case.