Docket UE20305
Order UE92-12

IN THE MATTER of a dispute between the Trustee in Bankruptcy of Green Gables Food Stores Limited and Maritime Electric Company, Limited.

BEFORE THE COMMISSION

on Wednesday, the 4th day of November, 1992.

Linda Webber, Chairman
John L. Blakney, Vice-Chairman

Order

WHEREAS:

The Trustee in Bankruptcy of Green Gables Food Stores Limited (the "Trustee") has applied to the Commission for an order:

(1) directing Maritime Electric Company, Limited to return to the Trustee in Bankruptcy of Green Gables Food Stores Limited the sum of $12,000 paid to Counsel for the Trustee in trust;

(2) clarifying for the future the position of the utility vis a vis a Trustee in Bankruptcy for one of its customers and ability of a provincially-regulated utility to impede the duty of a Federally-appointed trustee in Bankruptcy preserve (sic) the assets of a bankrupt for proper distribution to creditors by the Court.1

Maritime Electric Company, Limited (the "Company") has responded to this application with a preliminary objection with respect to the jurisdiction of this Commission to hear this application, stating any adjudication of the issues raised by the Trustee would properly be a civil matter over which the Superior Courts of this province would have jurisdiction.2

The Commission asked for written submissions on the preliminary objection and has reviewed these submissions.

Although there has been no sworn evidence heard by the Commission on this matter, a number of facts can be ascertained from the submissions of the parties. Most of these would appear to be agreed upon by the parties, although each gave somewhat different emphasis on them. While our decision on the preliminary issue does not bear upon these facts, we feel that they can provide a context for the decision and are relevant for that purpose. Ultimately, sworn evidence-or an agreed statement of facts-will be required before any final decision on the merits can be made.

In brief summary, the facts as we understand them are as follows.

On June 21, 1991, Green Gables Food Stores Limited was placed in bankruptcy and Green Haley & Pye of Halifax was appointed the Trustee in Bankruptcy. On the same day, but approximately one hour later, Ernst & Young Inc. was appointed receiver and manager of Green Gables Food Stores Limited, by a secured creditor. At the time of the bankruptcy, Green Gables Food Stores Limited was in arrears in its account with the Company. On June 24, 1991, the Company made a demand for payment of its account with Green Gables and gave notice of its intent to discontinue service if not paid. Both the receiver and the Trustee offered to be responsible for electrical service while the receiver was in control of the Green Gables assets in PEI, and each requested service in its name. The Company refused to supply the service to either, stating that the customer was still Green Gables. Discussions continued for a couple of days after which the Company gave a further notice (June 28, 1991) that disconnection was imminent. At that point the Trustee paid the $12,000.00 said to be owed by Green Gables, allegedly under protest. A letter applying for the remedies cited above was filed with the Public Utilities Commission on August 28, 1991.

The Company is relying upon Section 4.3.4 of the Prince Edward Island Electric Utilities General Rules and Regulations as justification for its action. That section states:

4.3.4 No Application for service at any metered location shall be accepted by the Utility:

(i) if the applicant is a customer or former customer who is in default in payment of any amount due to the Utility, or

(ii) if the applicant is a related person to or the agent of any person referred to in (i), applying for service at premises occupied by a person referred to in (i).

While The Company's submission on the issue of jurisdiction frames all references to the application as a claim for a money judgment against Maritime Electric, this view fails to consider the context from which that claim flows. The real dispute is over the application of Section 4.3.4 to the facts of this situation. Incidental to the application of that rule, the Trustee was required to pay $12,000.00 to maintain electric service at Green Gables.

If the rule was applied incorrectly, the Company would have had no authority for its actions and would not be justified in refusing to provide service to the Trustee as requested. If the rule was correctly applied, then the Trustees' claim for return of the money would fail.

Since the Commission has the responsibility for supervision of the utility, this matter appears to be directly within its mandate as an area for investigation and resolution. A Trustee is in no better or worse position than any other customer of the utility, and is subject to the same rules and regulations. The resolution of money disputes is part of the overall mandate of the Commission, but only incidental to the general power to supervise the operation of the utility. As was stated by Mr. Justice Dickson (as he then was) of the Supreme Court of Canada in Reference Re Residential Tenancies Act (1981), 123 D.L.R. (3d) 554 at pp. 570 - 571:

An administrative tribunal may be clothed with power formerly exercised by s. 96 Courts, so long as that power is merely an adjunct of, or ancillary to, a broader administrative or regulatory structure.

In view of the above, the preliminary objection of the Company cannot, in our opinion, be sustained.

IT IS THEREFORE ORDERED THAT

1. The preliminary objection of the Company is dismissed; and

2. A hearing into the application of the Trustee will be held at a date to be fixed.

DATED at Charlottetown, Prince Edward Island, this 4th day of November, 1992.

BY THE COMMISSION:

Linda Webber, Chairman

John L. Blakney, Vice-Chairman

1 Letter dated August 27, 1992 from Michael A. Farmer to the PEI Public Utilities Commission, pp.3-4.

2 Letter dated August 13, 1992 from Maureen M. Gregory to the Island Regulatory and Appeals Commission, p.5.