Can a party claim force majeure when they contributed to the delays? Desert Power v. Public Service Commission Explained

The Utah Court of Appeals addressed whether a power company could invoke force majeure provisions when it partially contributed to project delays in Desert Power, LP v. Public Service Commission.

Background and Facts

Desert Power constructed a combined-cycle power plant and entered a Power Purchase Agreement with PacifiCorp requiring commercial operation by May 9, 2006. When PacifiCorp redesigned the interconnection system based on Desert Power’s technical specifications, causing delays, Desert Power invoked the contract’s force majeure provision. The provision defined force majeure as “any cause beyond the reasonable control” of either party that the party “is unable to prevent or overcome.” The Public Service Commission denied relief, finding that Desert Power’s own miscalculations and delayed submission of technical data contributed to the delays.

Key Legal Issues

The court examined whether the Commission correctly interpreted the force majeure provision and whether Desert Power preserved challenges to the Commission’s factual findings. Desert Power argued the provision covered delays caused by either party individually, not both parties jointly.

Court’s Analysis and Holding

The court applied correction of error review to contract interpretation and substantial evidence review to factual findings. Even accepting Desert Power’s contract interpretation, the court found that the Commission’s factual determination that Desert Power contributed to delays precluded force majeure relief. The delays could not be “beyond Desert Power’s reasonable control” when Desert Power’s own actions caused them. Critically, the court found Desert Power failed to preserve challenges to the factual findings by not raising sufficiency objections in its reconsideration request.

Practice Implications

This decision emphasizes the importance of preservation requirements in Public Service Commission proceedings. Under Utah Code section 54-7-15, parties cannot raise issues on appeal that were not included in their reconsideration applications. Practitioners must specifically challenge factual findings’ sufficiency at the agency level to preserve appellate review. The decision also demonstrates that force majeure claims require careful factual development showing the claiming party bore no responsibility for the triggering events.