Public Utility Commission of Texas v. City of Sherman

POWERS, Justice.

Luella Water Supply Corporation (Luella) is a public utility. It is regulated by the Public Utility Commission of Texas and operates under a certificate of public convenience and necessity issued by that agency. The corporation furnishes water to the City of Luella, Texas, under a “franchise agreement” with that municipality. The City of Sherman, Texas, operates its own municipal water system. Luella complained to the Commission that the City of Sherman had embarked upon a plan to produce, for its own use, water contained in the same underground “sands” or strata as those from…