Mass. Municipal Wholesale Electric Co. v. State

MMWEC_V_STATE.92-440; 161 Vt. 346; 639 A.2d 995

[Filed 04-Feb-1994]

 NOTICE:  This opinion is subject to motions for reargument under V.R.A.P.
 40 as well as formal revision before publication in the Vermont Reports.
 Readers are requested to notify the Reporter of Decisions, Vermont Supreme
 Court, 109 State Street, Montpelier, Vermont 05609-0801 of any errors in
 order that corrections may be made before this opinion goes to press.


                                 No. 92-440


 Massachusetts Municipal Wholesale            Supreme Court
 Electric Co.
                                              On Appeal from
      v.                                      Washington Superior Court

 State of Vermont, et al.                     February Term, 1993



 Stephen B. Martin, J.

 Stephen S. Ankuda of Parker & Ankuda, P.C., Springfield, and Nicholas J.
   Scobbo, Jr. and Gerald J. Caruso of Ferriter, Scobbo, Sikora, Singal,
   Caruso and Rodophele, P.C., Boston, Massachusetts, for plaintiff-
   appellant

 Jeffrey L. Amestoy, Attorney General, and William Griffin, Chief Assistant
   Attorney General, Montpelier, for defendant-appellee State of Vermont

 Peter H. Zamore of Sheehey Brue Gray & Furlong, P.C., Burlington, and
   Christopher L. Dutton, South Burlington, for defendant-appellee Green
   Mountain Power Corp.

 Edward B. French of Stackpole & French Law Offices, Stowe, for defendant-
   appellee Village of Stowe

 Edward V. Schwiebert and Laura E. Johnson of Abell, Kenlan, Schwiebert &
   Hull, P.C., for defendants-appellees Villages of Ludlow, Hardwick,
   Morrisville and Swanton


 PRESENT:  Allen, C.J., Gibson and Morse, JJ., and Davenport, Supr. J. and
           Ellison, D.J. (Ret.), Specially Assigned



      GIBSON, J.   Plaintiff Massachusetts Municipal Wholesale Electric
 Company (MMWEC) appeals from a summary judgment order declaring valid its
 Stony Brook Power Project contracts with defendant Vermont utilities.  MMWEC

 

 contends that the contracts are void ab initio under Vermont Dep't of Pub.
 Serv. v. Massachusetts Mun. Wholesale Elec. Co., 151 Vt. 73, 558 A.2d 215
 (1988), (MMWEC I), which declared contracts for MMWEC's Seabrook Power
 Project void.  MMWEC also argues that, on its face, 1989, No. 112, { 1 (Act
 112, { 1) does not ratify the contracts, and, in any event, that the Vermont
 Legislature does not have the power to ratify them.  Finally, MMWEC argues
 that, if Act 112 ratifies the Stony Brook contracts, it violates MMWEC's
 rights under the Due Process, Contract, and Commerce Clauses of the federal
 Constitution.  We hold that, although the Stony Brook contracts with the
 municipal utilities would have been void under MMWEC I, they nevertheless
 were ratified by Act 112, { 1 and are valid.  In addition, we conclude that
 the contract with Green Mountain Power Corporation (GMP) is valid under
 MMWEC I.
      MMWEC is a public corporation and political subdivision of the
 Commonwealth of Massachusetts that acts as a joint planning and action
 agency through which suppliers of electricity develop electric power supply
 programs for municipal utilities.  It is governed by a board of nine
 directors, two appointed by the Governor and seven elected by member munici-
 palities.  Only Massachusetts municipalities having electric departments may
 be members.  Vermont electric suppliers that contract with MMWEC are not
 represented on the Board.
      Since 1976, MMWEC has been developing a bulk power supply system by
 obtaining ownership interests in electric power facilities through planning
 and acquisition vehicles called "projects."  MMWEC finances a project by
 issuing long-term revenue bonds, which are secured by payments made by proj-
 ect participants under power sales agreements (PSAs).  Project participants

 

 are both member and nonmember municipal electric suppliers who contract with
 MMWEC to purchase a share of "project capability," that is, "the amount of
 electric capacity and energy, if any, which the Project is capable of pro-
 ducing at any particular time . . . ."  In exchange, project participants
 agree to pay monthly pro rata shares of the costs MMWEC incurs in acquiring,
 constructing, financing and operating the project.  MMWEC retains all
 ownership interest in the project.
      Under the terms of the PSAs, MMWEC establishes the amount of monthly
 payments to provide sufficient revenues to meet its full obligations, and
 project participants must set electric rates sufficient to pay their shares
 of MMWEC's project costs, including debt service.  The PSAs are subject to
 MMWEC's General Bond Resolution, which vests in the MMWEC board of directors
 sole discretion to issue bonds for each project.  The PSAs also restrict the
 participants' ability to issue nonproject debt and require project partici-
 pants to make payments to MMWEC whether or not the project is completed or
 operating, thus shifting all risks of the project to participants.
      One of MMWEC's projects is the Stony Brook Intermediate Unit, an oil-
 and gas-fueled generating facility that MMWEC began building in 1977 in
 Ludlow, Massachusetts.  In October 1977, defendants, the Villages of Ludlow,
 Hardwick, Morrisville, Stowe and Swanton, and GMP, executed PSAs to purchase
 shares of project capability of MMWEC's Stony Brook project.  The facility
 began commercial operation in 1981, and defendants have been receiving power
 pursuant to the Stony Brook PSAs since that time.  The Stony Brook PSAs
 require the participants to pay MMWEC whether or not the project produces
 electricity.  The validity of these PSAs is the subject of this action.

 

      The enforceability of MMWEC PSAs was previously adjudicated in MMWEC I.
 In 1979, MMWEC executed PSAs with five Vermont municipalities and two
 Vermont electric cooperatives to sell shares of project capability of
 MMWEC's ownership interest in two proposed nuclear generating units known as
 Seabrook Units Nos. 1 and 2.  The parties' rights and obligations under the
 Stony Brook PSAs are almost identical to those under the Seabrook PSAs.
 Seabrook was under construction but had not begun producing electricity in
 October 1985, when the Vermont Department of Public Service filed a
 complaint against MMWEC in superior court seeking a declaration that the
 Seabrook PSAs were invalid.  Because the Stony Brook PSAs are virtually
 identical to the Seabrook PSAs, MMWEC filed this action in July 1986,
 initially requesting a declaration that the Stony Brook PSAs are valid.  The
 parties stipulated to postponing those proceedings until this Court reached
 a decision regarding the Seabrook PSAs.
      In MMWEC I, we held that the Seabrook PSAs were void ab initio because
 provisions assigning to MMWEC all decision-making power with respect to
 incurring debt and making expenditures constituted an impermissible delega-
 tion of legislative authority by the municipalities and electric cooper-
 atives.  151 Vt. at 86, 89-90, 558 A.2d  at 223, 224-25.  In particular, we
 concluded that paragraph 3(a) of the PSAs constituted an impermissible
 delegation of spending authority because it provided that "MMWEC makes all
 decisions to incur, or to refrain from incurring, project debt."  Id. at 82-
 83, 558 A.2d  at 221.  MMWEC thus had "exclusive control over the magnitude
 of the participants' monthly payments and over the duration of those
 payments."  Id.  We also concluded that paragraph 5(f) violated the
 nondelegation doctrine by restricting the participants' "power to make

 

 expenditures with regard to other projects or purchases."  Id. at 85, 558 A.2d  at 222.
      In response to MMWEC I, the Vermont Legislature enacted Act 112, { 1,
 which purports to ratify certain energy contracts for electric capacity or
 energy from plants in operation by January 1, 1989.  Subsequently, the
 parties to this action entered into a stipulation under which MMWEC amended
 its complaint to request a declaration that the Stony Brook PSAs are void on
 the ground that they are virtually identical to the Seabrook PSAs.
      On cross-motions for summary judgment, the trial court held that this
 case is factually distinguishable from MMWEC I and thus the Stony Brook PSAs
 are not void ab initio under the reasoning of that case.  Further, it held
 that by enacting Act 112, {1, the Vermont Legislature had ratified the
 Stony Brook PSAs.  Finally, it concluded that applying Act 112 to the Stony
 Brook PSAs does not violate MMWEC's constitutional rights.  MMWEC appeals
 from these trial court rulings.
                                     I.
      MMWEC first argues that the court erred in determining that MMWEC I
 does not control this case because the PSAs at issue here are indistinguish-
 able from the PSAs in MMWEC I.  We agree that MMWEC I controls as to the
 Vermont municipalities.  MMWEC I, however, considered the validity of PSAs
 executed by municipalities and electric cooperatives only.  It did not
 decide whether an investor-owned corporation was acting beyond its power by
 entering a similar PSA.  Thus, we address the validity of the Stony Brook
 PSA executed by GMP separately.
      In MMWEC I, we declared the Seabrook PSAs void because the Vermont
 municipalities impermissibly attempted to redelegate their legislative

 

 authority to incur debt and to make expenditures on other projects or
 purchases.  Id. at 86, 558 A.2d  at 223.  A comparison of the contracts for
 the two projects reveals that the essential terms of the Stony Brook PSAs
 are almost identical to those of the Seabrook PSAs.  Specifically, the Stony
 Brook PSAs contain the same two provisions that necessitated declaring the
 Seabrook PSAs void in MMWEC I.  Both contracts impermissibly transfer to
 MMWEC exclusive control over decisions to incur project debt and to set the
 participants' monthly payment amounts.  Both contracts restrict the power of
 the municipalities to incur other debts, thus limiting the future exercise
 of legislative authority.  See id. at 83, 85, 558 A.2d  at 221, 222.
      Nonetheless, defendant municipalities proffer two bases for
 distinguishing the Stony Brook Project from the Seabrook Project.  First,
 they argue that Stony Brook involved less risk than Seabrook because it con-
 cerned a gas-and-oil-fueled facility rather than a nuclear facility.  Defen-
 dants maintain that the risk in undertaking a conventional gas-and-oil power
 plant is minimal.  They equate MMWEC's authority under the Stony Brook PSAs
 to that of a general contractor, who supervises construction and acquires
 the materials.  Because the risk was minimal, defendants maintain that the
 delegation of authority under the Stony Brook PSAs was permissible.
      MMWEC disputes defendants' risk assessment, maintaining that Stony
 Brook may have been considered more risky at the time the PSAs were
 executed due to the oil embargoes of the late 1970s.  This dispute need not
 be resolved here, however.  As MMWEC contends, an evaluation of the risks of
 the two projects is irrelevant to our decision because we are not judging
 the projects; rather, we are determining the validity of the contracts.

 

      Second, defendants emphasize that Stony Brook has been in operation for
 eleven years and that they have been receiving power and making payments
 throughout this period.  Thus, they distinguish the Seabrook Project because
 neither Seabrook unit had ever been in operation at the time of the decision
 in MMWEC I.  According to defendants, the decision in MMWEC I turned in part
 on the fact that defendants were required to make monthly payments to MMWEC
 but had never received any power.  They maintain that, in contrast to the
 Seabrook PSAs, which were for "project capability," the Stony Brook PSAs
 became contracts for electric capacity and energy when defendants began
 receiving power from the Stony Brook Unit.
      Defendants' characterization of the Stony Brook PSAs as contracts for
 electric capacity and energy, as opposed to project capability, is
 incorrect.  Under the terms of the PSAs, defendants purchased project
 capability, and if Stony Brook stopped operating today, the PSAs require
 that defendants continue to make payments to MMWEC.  Further, our decision
 in MMWEC I was not influenced by the fact that the Seabrook Units had not
 produced any power.  See id. at 90, 558 A.2d  at 225.  Thus, whether or not
 the Vermont utilities are currently receiving electrical power pursuant to
 the Stony Brook PSAs is irrelevant to our decision here.
      Defendant Village of Stowe also argues that when the Stony Brook
 facility was completed in 1981 and defendants began receiving power in re-
 turn for payments, the PSAs executed in 1977 were "confirmed."  It contends
 essentially that, because the party that acted ultra vires has received
 benefits under the contract for eleven years, the contract is somehow
 ratified.  The other municipalities contend that they have ratified the PSAs
 by continuing to perform pursuant to them for eleven years.  Defendants cite

 

 no authority to support either contention, nor do we find any.  On the con-
 trary, it is generally held that an ultra vires contract cannot be ratified
 by any action of the corporation that acted outside its authority.  Metro-
 politan Stock Exch. v. Lyndonville Nat'l Bank, 76 Vt. 303, 308, 57 A. 101,
 102 (1904); see also 10A E. McQuillin, The Law of Municipal Corporations {
 29.104.30, at 67 (3rd ed. 1990) (municipality cannot ratify a contract that
 it was not legally permitted to enter into).
      Defendants also argue that they have not impermissibly redelegated
 their authority because they have retained a voice in decisionmaking
 concerning Stony Brook through their participation in the New England Power
 Pool (NEPOOL).  The Stony Brook unit is subject to central dispatch by
 NEPOOL.  Defendant municipalities may influence NEPOOL as shareholders of
 the Vermont Electric Power Company (VELCO) because VELCO is a charter member
 of NEPOOL.  The parties, however, dispute the extent and the effectiveness
 of defendants' influence through NEPOOL on MMWEC's decisions regarding Stony
 Brook.
      Initially, we note that the same provisions regarding NEPOOL were
 present in the Seabrook PSAs.  Thus, we cannot distinguish this case from
 MMWEC I on the ground that the municipalities retained a voice in decision-
 making through NEPOOL.  Moreover, even if defendants can influence MMWEC's
 operation of Stony Brook through NEPOOL, this does not affect the PSA re-
 strictions upon defendants' ability to incur other debts.  These restric-
 tions are also impermissible delegations of authority.  See MMWEC I, 151 Vt.
 at 86, 558 A.2d  at 223.  The NEPOOL participation is simply too narrow to
 affect the illegality of the broad redelegation of authority found in the
 PSAs.

 

      Because the pertinent contractual provisions in the Stony Brooks PSAs
 are virtually identical to those in the Seabrook PSAs, we find no basis to
 distinguish the redelegation of legislative power in the Stony Brook PSAs.
 Therefore, we hold, under MMWEC I, that the Stony Brook PSAs executed by
 the five Vermont municipalities violate the nondelegation doctrine and would
 be void had they not been ratified by the Legislature.(FN1)
                                     II.
      MMWEC argues that, by its terms, Act 112, { 1 does not validate the
 Stony Brook PSAs executed by the municipalities.  Act 112, { 1 provides in
 part, "All contracts for the purchase, sale, generation, manufacture,
 acquisition or transmission of electric capacity or energy entered into
 pursuant to chapters 14, 79, 81, 83 or 84 of Title 30 . . . are hereby
 validated, ratified, and confirmed . . . ."  1989, No. 112, { 1 (emphasis
 added).  MMWEC contends that the Act does not apply to the Stony Brook PSAs
 because they are contracts to purchase "project capability," not "electric
 capacity or energy."  We agree that MMWEC I makes this distinction but
 nonetheless hold that the legislative history unequivocally shows that the
 Legislature intended Act 112 to ratify the Stony Brook PSAs.
      In MMWEC I, the Court distinguished "project capability" from "electric
 capacity and energy."  "Project capability" is defined in the PSAs as "the
 amount of electrical capacity and energy, if any, which the Project is
 capable of producing at any particular time . . . ."  Thus, by contracting
 to purchase project capability, the utilities agreed to make payments to
 MMWEC whether or not they received any power in return.  MMWEC I, 151 Vt. at

 

 79, 558 A.2d  at 218.  In contrast, "electric capacity and energy" refers to
 actual supplies of capacity and energy that exist in ascertainable amounts.
 Id. at 78, 558 A.2d  at 218.  On the basis of this distinction, we held that
 30 V.S.A. { 4002, which authorizes utilities jointly to purchase "supplies
 of capacity and energy," does not authorize utilities to purchase "project
 capability."  Id.  Because { 4002 authorizes utilities to enter into
 contracts for capacity and energy and does not authorize them to enter into
 contracts for project capability, we must conclude that Act 112, { 1, which
 ratifies contracts for electric capacity or energy, does not ratify
 contracts for project capability.  On its face, Act 112 does not evidence a
 legislative intent to ratify contracts for project capability.
      Defendants contend, however, that "[t]he legislative history of [Act]
 112 demonstrates the Vermont Legislature's clear intent to validate the
 Stony Brook PSAs."  In construing a statute, our primary objective is to
 give effect to the Legislature's intent.  Burlington Elec. Dep't v. Vermont
 Dep't of Taxes, 154 Vt. 332, 335, 576 A.2d 450, 452 (1990).  Ordinarily, we
 rely on the plain meaning of the language and look no further because we
 presume the Legislature states what it intends.  Chamberlin v. Department of
 Taxes, ___ Vt. ___, ___, 632 A.2d 1103, 1104 (1993).  Nevertheless,
 principles of statutory construction are not absolutes, and "where such a
 presumption is doubtful, the 'plain' meaning of the words will not
 necessarily control," id. at ___, 632 A.2d  at 1104, for, ultimately, "it is
 [the legislative] intent which constitutes the law."  Hill v. Conway, 143
 Vt. 91, 93, 463 A.2d 232, 233 (1983).  We find that the clear intent of the
 Legislature was to validate and ratify all contracts for the purchase of
 electric capacity or energy, or project capability, from facilities that

 

 were in commercial operation as of January 1, 1989, including the Stony
 Brook contract.
      We cannot ignore the substantial, well-documented, legislative history
 of Act 112, { 1.  Act 112, { 1 was introduced with the express purpose of
 validating contracts put in jeopardy by MMWEC I.  Throughout several days of
 testimony by more than a dozen witnesses, the need to save PSAs similar to
 Seabrook was thoroughly discussed, and the Stony Brook PSAs were
 specifically named as being among the endangered contracts to be saved.
 See, e.g., Hearings on H. 270 before House Commerce Committee, Mar. 3,
 1989, at 12-19 (testimony of Stephen Walke, General Counsel for Vermont
 Public Power Supply Authority (VPPSA) and Village of Swanton) (bill's
 purpose is to validate contracts that had come into question as result of
 MMWEC I); id. at 50-51 (testimony of Richard Saudek, former Commissioner of
 the Department of Public Service) (bill reverses most of MMWEC I, except for
 specific ruling on Seabrook PSAs, and validates "all existing agreements");
 id. at 56 (using Stony Brook as example of MMWEC contract that should be
 saved); see also Hearings on H. 270 before House Commerce Committee, Mar.
 16, 1989, at 4-5, 10-11 (testimony of Jack Collins, chairman of VPPSA and
 employee of Village of Ludlow Electric Light Department) (explaining
 problem of power contracts whose validity has been questioned as result of
 MMWEC I, using Stony Brook PSA as example); Hearings on H. 270 before
 Senate Finance Committee, Apr. 25, 1989, at 31-35 (testimony of Fred
 Hutchins, Stowe Electric Company) (speaking in support of bill because it
 would save Stony Brook PSA); id. at 55 (testimony of Richard Saudek)
 (purpose of bill as amended is "essentially approving contracts that are now
 producing power, that are now in place and trying to remove any cloud from

 

 them"); id. at 81-83 (testimony of Stephen Walke) (assuring committee that
 MMWEC will continue to honor Stony Brook contract if Legislature ratifies it
 but that, without legislative ratification, it was "as dead as the Seabrook
 contract was").  In addition, the Stony Brook PSAs were included on a list,
 requested by the Senate Finance Committee, of contracts to be ratified.  See
 Hearings on H. 270 before Senate Finance Committee, Apr. 27, 1989, at 24-25
 (testimony of Stephen Walke) (presenting list of existing PSAs in effect
 before January 1, 1989, that were to be validated by Legislature); see also
 Attachment A to Affidavit of Shirley Adams, administrative secretary for
 Legislative Council for Vermont General Assembly (May 26, 1992) (copy of
 list of PSAs to be validated) and id. at 1-2 (authenticating the list).
      As the hearings became bogged down with other issues, the legislators
 became increasingly dependent on experts to explain utility terms of art.
 But there is no discussion in the legislative record about the difference
 between contracts for "project capability," and contracts for "electric
 capacity or energy."  The Stony Brook PSAs, like the Seabrook PSAs, are
 written for "project capability" as that term is defined in MMWEC I.  We
 cannot account for why the Legislature, which had both MMWEC I and the Stony
 Brook PSAs before it, did not recognize the distinction.  Perhaps the
 drafters reasoned that, because Stony Brook, unlike Seabrook, was actually
 producing energy and had done so since 1981, it was more accurately des-
 cribed as a contract for electric capacity or energy.  Certainly, the common
 meaning of the words, if not the utility term of art, conveys this thought.
 But whatever the explanation for this anomaly, we cannot use it to defeat
 the overriding purpose of the legislative act.  Throughout the confusing
 and protracted legislative process, the Legislature's intent to save the

 

 PSAs endangered by MMWEC I, including the Stony Brook PSAs, was unwavering
 and unmistakable.
      In using this approach, we emphasize that we are not relying on a few
 statements sprinkled throughout hundreds of transcript pages.  Saving the
 Stony Brook PSAs was virtually the sole focus of the legislative hearings.
 The question was not whether to save the PSAs, but how.  A dozen witnesses
 -- lobbyists, regulators, municipal officials, attorneys -- spoke in favor
 of saving the PSAs and stated that the proposed legislation would accomplish
 this end.  There was no serious opposition to the legislation,(FN2) and no one
 put forth the view that the legislation was flawed.  This is a rare case
 where the legislative history clearly and unequivocally speaks the
 legislative intent and must govern our construction of the statutory
 language.
                                    III.
      MMWEC contends that the Legislature cannot ratify the Stony Brook PSAs
 because they are void ab initio, see MMWEC I, 151 Vt. at 86, 558 A.2d  at

 

 223, and therefore no contract exists to validate.  In MMWEC I, however, the
 PSAs were void because the municipalities' execution of the agreements was
 ultra vires, that is, the municipalities went beyond their authority by
 redelegating legislative spending power.  Id.  Although, ordinarily,
 contracts that are void ab initio cannot be revived, this rule does not
 apply to legislative ratification of ultra vires contracts.  New Haven Water
 Co. v. City of New Haven, 40 A.2d 763, 766 (Conn. 1944).  To the contrary,
 the general rule is that
         provided it had the power to authorize the making of
         the contract in the first instance, the legislature of
         the state has power to legalize or ratify an ultra vires
         contract entered into by a municipal corporation for a
         public purpose, and when thus ratified the contract will
         be valid and binding.

 10A E. McQuillin, supra { 29.109, at 88 (footnote omitted); see, e.g., New
 Haven Water Co., 40 A.2d at 765-66; Williamson Real Estate Co. v. Sasser,
 103 S.E. 73, 74 (N.C. 1920); see also Richford Savings Bank & Trust Co. v.
 Thomas, 111 Vt. 393, 399, 17 A.2d 239, 242 (1941) (because Legislature has
 taxing power and can direct towns on manner of making appraisals and grand
 list, it has power to validate improper grand list).
      MMWEC next contends that, because the Legislature can only validate
 contracts that it might have originally authorized, it cannot validate the
 PSAs because it cannot delegate its spending power.  The Legislature cannot
 delegate functions that are "'purely and strictly legislative.'"  Village of
 Waterbury v. Melendy, 109 Vt. 441, 453, 199 A. 236, 242 (1938) (quoting
 Sabre v. Rutland R.R., 86 Vt. 347, 365, 85 A. 693, 701 (1913)). The power to
 enact laws is inherently legislative and nontransferable.  Vermont Educ.
 Bldgs. Fin. Agency v. Mann, 127 Vt. 262, 267, 247 A.2d 68, 72 (1968).  The
 Legislature may, and indeed as a practical matter must, confer broad

 

 discretion on other agencies to execute its laws.  Id.  The Legislature's
 authority to delegate to others the power to negotiate and execute
 "contracts to achieve a valid public objective" is long settled.  Id. at
 268, 247 A.2d  at 72 (citing power contract cases as examples).
      MMWEC I presents no obstacle to legislative delegation of the spending
 power.  Rather, the decision condemns only municipal redelegation of such
 power without specific legislative authority to do so.  See 151 Vt. at 86
 n.3, 558 A.2d  at 223 n.3 (legislative power granted to municipality can
 only be redelegated to third party if "'"such was the clear intent of the
 legislature"'") (quoting Arkansas-Missouri Power Co. v. City of Kennett, 78 F.2d 911, 921 (8th Cir. 1935) (quoting National Water Works Co. of New York
 v. Kansas City, 20 Mo. App. 237, 242 (1886))).  The nondelegation doctrine
 thus condemns municipalities putting legislative powers beyond legislative
 intent.  But if the Legislature could have entered a PSA or authorized a
 municipality to enter one in its behalf, then it can ratify a PSA.  Under
 this theory, curative statutes have been used to validate unauthorized
 expenditures or indebtedness by municipalities.  2 E. McQuillin, supra {
 4.15, at 49; see, e.g., Palmcroft Dev. Co. v. City of Phoenix, 49 P.2d 626,
 631 (Ariz. 1935); Otter Tail Power Co. v. City of Colman, 121 N.W.2d 483,
 485-86 (S.D. 1963).
      MMWEC argues that because the declaratory judgment action was filed
 prior to the passage of Act 112, Act 112 cannot apply in this case.  Its
 argument is based on 1 V.S.A. { 213, which states that acts of the general
 assembly "shall not affect a suit begun or pending at the time of their

 

 passage."(FN3) Section 213 is a rule of statutory construction, not a grant of
 substantive rights or a bar on retrospective application of statutes.  As a
 rule of construction, { 213 does not apply if it contradicts "the manifest
 intent of the general assembly."  1 V.S.A. { 101.  Thus, if the Legislature
 chooses to make legislation retroactive and makes that intent clear, as it
 specifically has done here, { 213 is not a bar.  See Burlington Fire
 Fighters' Ass'n v. City of Burlington, 149 Vt. 293, 296, 543 A.2d 686, 688-
 89 (1988) (retroactive application of legislation is valid if Legislature so
 intends).
                                     IV.
      Although we hold that the Legislature successfully validated the Stony
 Brook PSA, constitutional bars may, nevertheless, render Act 112 void.
 MMWEC argues that validating legislation violates its rights under the Due
 Process, Contract, and Commerce Clauses of the federal constitution.  We
 disagree.
      MMWEC first argues that it has a vested right in the power generated at
 the Stony Brook facility -- that is, the right to sell it to whom it chooses
 under the terms it desires -- which cannot be destroyed without due process.
 The federal Due Process Clause only prohibits retrospective civil legisla-
 tion if its consequences are particularly "'harsh and oppressive.'"  United
 States Trust Co. of New York v. New Jersey, 431 U.S. 1, 17 n.13 (1977)
 (quoting Welch v. Henry, 305 U.S. 134, 147 (1938)).  Even assuming vested

 

 rights are involved, "'legislative Acts adjusting the burdens and benefits
 of economic life come to the Court with a presumption of constitutionality,
 and that the burden is on one complaining of a due process violation to
 establish that the legislature has acted in an arbitrary and irrational
 way.'"  Pension Benefit Guar. Corp. v. R.A. Gray & Co., 467 U.S. 717, 729
 (1984) (quoting Usery v. Turner Elkhorn Mining Co., 428 U.S. 1, 15 (1976)).
 Retroactive legislation needs to meet no higher burden; the test for
 constitutionality is to show merely that the "retroactive application of the
 legislation is itself justified by a rational legislative purpose."  Id. at
 730.
      Here, the Legislature did not act arbitrarily or irrationally by
 validating the Stony Brook PSAs.  Although the agreements were entered into
 by municipalities acting ultra vires, there is no indication that they were
 not otherwise properly bargained for.  The parties relied on the contracts
 for eleven years.  Power was produced and used as the contracting parties
 intended.  Act 112 is curative legislation, attempting to normalize con-
 tractual relationships that had been called into question by MMWEC I.  The
 Legislature did not pick and choose between the PSAs, validating some and
 not others; it simply validated all agreements endangered by MMWEC I.
 Retroactive application of the validating legislation was necessary so that
 the operation of the PSAs was uninterrupted.
      MMWEC also contends that Act 112 impairs its contractual rights by
 binding it to obligations that did not exist prior to its passage.  The
 Contract Clause requires a more stringent analysis than the Due Process
 Clause.  Pension Benefit, 467 U.S.  at 733.  The Contract Clause provides
 that "No State shall . . . pass any . . . Law impairing the Obligation of

 

 Contracts."  U.S. Const., Art. I, { 10.  Yet, despite the absolute language
 of the Clause, the United States Supreme Court has held that it "does not
 operate to obliterate the police power of the States," Allied Structural
 Steel Co. v. Spannaus, 438 U.S. 234, 241 (1978), the state's power to
 promote the general welfare of its citizens being "'paramount to any rights
 under contracts between individuals.'"  Id. (quoting Manigault v. Springs,
 199 U.S. 473, 480 (1905)).  Consequently, the Court has created a balancing
 test, which weighs the restriction on contract rights against the state's
 interest in regulation.  Id. at 244-45.
      The first inquiry under this test is "whether the state law has, in
 fact, operated as a substantial impairment of a contractual relationship."
 Id. at 244.  MMWEC cannot cross this threshold.  Not every legislative act
 affecting contractual relationships is an impairment.  The Contract Clause
 has traditionally focused on legislation "designed to repudiate or adjust
 preexisting debtor-creditor relationships that obligors were unable to
 satisfy,"  Keystone Bituminous Coal Ass'n v. DeBenedictis, 480 U.S. 470, 503
 (1987), that is, where the legislature adds or deletes contract obligations,
 in effect rewriting what the parties bargained.  No such intervention is at
 issue here.  The parties' bargain has not been abrogated or altered by Act
 112.  Instead, the Act seeks to reinforce the parties' ability to rely on
 their own agreements.  See Allied Structural Steel, 438 U.S.  at 245
 (constitutional framers placed high value on parties' ability to order their
 business in reliance on their contracts).  MMWEC I called the validity of
 PSAs into question.  The Legislature did not rewrite the PSAs; it restored
 certainty to the parties' contractual relationship.  Because the

 

 Legislature's actions are not a contract impairment, the Contract Clause
 does not apply.
      Finally, MMWEC argues that Act 112 violates the Commerce Clause because
 it is a "protectionist measure" designed to benefit Vermonters at the
 expense of MMWEC's other customers.  Validating the Stony Brook PSAs gives
 Vermonters no advantage over other MMWEC customers; it simply means that
 Vermonters will have the same benefits as out-of-staters contracting with
 MMWEC for Stony Brook power.  Act 112 neither discriminates against inter-
 state commerce nor favors in-state economic interests over out-of-state
 ones, directly or indirectly.  See Brown-Forman Distillers Corp. v. New
 York State Liquor Auth., 476 U.S. 573, 579 (1986).  MMWEC's real dissatis-
 faction is that the Legislature chose to validate Stony Brook but not
 Seabrook.  The invalidation of the Seabrook PSA in MMWEC I undoubtedly did
 result in benefits to Vermont consumers over out-of-staters, but it is not
 the impact of Seabrook that is at issue in this case.
                                     V.
      MMWEC contends that GMP's Stony Brook PSA is also governed by the
 holding of MMWEC I because in that case the Court also recognized
 limitations on the authority of private corporations to delegate their
 powers and duties to others.  See MMWEC I, 151 Vt. at 88-89, 558 A.2d  at
 224.  GMP counters that MMWEC I does not invalidate its Stony Brook PSA
 because MMWEC I did not address the validity of PSAs executed by investor-
 owned corporations; rather, its holding was limited to PSAs executed by
 municipal utilities and cooperatives.  We agree with GMP.  The discussion
 regarding private corporations in MMWEC I related to the issue of whether
 cooperatives were public or private corporations.  MMWEC I did not consider

 

 the validity of PSAs executed by corporations, whose authority to act arises
 pursuant to the Vermont Business Corporation Act (VBCA), because this issue
 was not before the Court.  Accordingly, its holding does not extend to GMP's
 PSA with MMWEC.
      MMWEC contends that the VBCA provides no specific grant of authority
 permitting GMP to delegate GMP's spending power or to restrict GMP's future
 incursion of debt.  Consequently, MMWEC maintains, because GMP's board of
 directors has unlawfully abdicated its management functions in the PSA,
 GMP's PSA is ultra vires and void.  We do not decide whether GMP had the
 authority to enter the PSA because we conclude that 11A V.S.A. { 3.04
 precludes declaring the PSA ultra vires.
      Section 3.04 provides that, with certain enumerated exceptions, "the
 validity of corporate action may not be challenged on the ground that the
 corporation lacks or lacked power to act."  This statute was adopted from {
 3.04 of the Model Business Corporation Act, and, like the model act,
 eliminates the doctrine of inherent incapacity, except in actions (1) by a
 shareholder against the corporation, (2) by the corporation against an
 incumbent or former director, officer, employee, or agent of the
 corporation, or (3) by the attorney general.(FN4) See Comment to Model Business
 Corporations Act { 3.04 (1984).   Because none of the three exceptions
 applies here,  MMWEC is precluded from asserting GMP's lack of capacity in
 this declaratory action.  See Ohio Cent. Credit Union, Inc. v. Wagner, 426 N.E.2d 198, 199 (Ohio Ct. App. 1988) (similar statute forbids assertion that
 act was ultra vires in action between two corporations).
                                     VI.
      Finally, MMWEC asserts the trial court erred by failing to declare
 that the Stony Brook PSAs do not constitute unauthorized "debt" under 24
 V.S.A. { 1822 (municipality must obtain voter approval before exercising
 bonding power in connection with public utility project).  It requests a
 remand so the trial court can make such a declaration.
      The trial court correctly refrained from deciding the issue.  For a
 court to make a declaratory judgment, it must have before it an actual or
 justiciable controversy.  Doria v. University of Vermont, 156 Vt. 114, 117,
 589 A.2d 317, 318 (1991).  Otherwise, the judgment is merely an advisory
 opinion, which the court lacks constitutional authority to render.  Id.
 Consequently, "declaratory relief is available only when a party is
 suffering from 'the threat of actual injury to a protected legal interest.'"
 Id. (quoting Town of Cavendish v. Vermont Pub. Power Supply Auth., 141 Vt.
 144, 147, 446 A.2d 792, 794 (1982)).  The claimed consequences of the
 controversy "must be so set forth that the court can see that they are not
 based upon fear or anticipation but are reasonably to be expected."  Robtoy
 v. City of St. Albans, 132 Vt. 503, 504, 321 A.2d 45, 46-47 (1974).
      In its amended complaint, MMWEC asked for a declaration that { 1822
 had not been violated, asserting that, in MMWEC I, defendants Village of
 Stowe and State of Vermont had argued that the Seabrook PSAs violated {
 1822.  In MMWEC I, however, the trial court held that the Seabrook PSAs were
 not debts under { 1822.  That part of the decision was not appealed by any
 party.

 

      In their answers to MMWEC's amended complaint, all defendants denied
 that the Stony Brook PSAs violated { 1822.  No party, at any time, took the
 position that the Stony Brook PSAs were unauthorized debts.  MMWEC did not
 pursue the issue at the summary judgment hearing.  On appeal, the Village of
 Stowe, which was the only party to brief the issue, argues in favor of
 MMWEC's position.  MMWEC has failed to establish that an actual controversy
 existed for the trial court to resolve.
      Affirmed.
                                    FOR THE COURT:



                                    ______________________________
                                    Associate Justice


------------------------------------------------------------------------------
                                Footnotes

FN1.    Defendant municipalities raise a number of defenses to MMWEC's claim
 that the PSAs are invalid.  Because we hold that the Legislature
 successfully ratified the PSAs, we do not reach these issues.

FN2.    MMWEC puts forth a single statement of Sen. Vincent Illuzzi to show
 that the legislative history "equally supports MMWEC's position that the
 Legislature did not intend to ratify the Stony Brook PSA."  This statement,
 made before the Senate Finance Committee (April 25, 1989, at 83), was: "In
 fairness to MMWEC, though maybe that contract [the Stony Brook PSA] should
 be opened up.  Right?  I mean they got screwed on the other one [Seabrook]."
 The response of other participants, however, undercuts MMWEC's position:
     Sen. Webster:  You're just kidding, right?
     Mr. Walke:     I hope he's just kidding.  I hope you're
                    representing Vermont ratepayers and not
                    Massachusetts ratepayers.
     Sen. Ready:    You never know.
     Sen. Illuzzi:  Fair is fair.
 At that point, the discussion ended and Sen. Illuzzi's point was not
 pursued.

FN3.    MMWEC argues in the alternative that Act 112 is rendered inoperative
 by 1 V.S.A. { 214(b)(2) and (4), which respectively define the effect of
 statutory amendments on preexisting rights and pending court proceedings.
 MMWEC then concedes, however, that Act 112 does not amend or repeal any
 existing statute, and that therefore { 214 does not apply.  We agree and do
 not reach this issue.

FN4.    11A V.S.A. { 3.04 went into effect on January 1, 1994.  It replaces,
 but retains the essential elements of, its predecessor statute, 11 V.S.A. {
 1854.  While { 3.04 is based on the 1984 version of the Model Business
 Corporation Act, { 1854 was based on the 1972 version of the same model
 act.