South Eastern Indiana Natural Gas Co. v. Ingram

mеrit Swett's found no We have estoppel. Given of waiver

assertions con representations Flynn's

evidence issue of a material coverage,

cerning policy Anderson knew as to whether

fact remains dif policy known that or should de coverage that Anderson

fered from the inappropriate is therefore The issue

sired. be ad and should summary disposition,

for trier of fact. before a

judicated motion of First State's

The denial judg- summary and the

summary judgment were Flynn and Swett granted

ments each reverse in error. We therefore

each proceedings consis- further remand for opinion.

tent with REMANDED.

REVERSED AND JJ., RUCKER, concur.

ROBERTSON INDIANA NATURAL

SOUTH EASTERN INC., CO., Appellant-

GAS

Defendant, INGRAM, and Donna

Frank

Appellees-Plaintiffs.

No. 69A01-9208-CV-263. Indiana, Appeals of

Court District.

First

July19,1993. supplied them, experi partial

enced a interruption of service to its customers in the form of a reduction in line pressure.1 Employees of South Eastern spent early hours of January responding calls; however, at no time did South attempt Eastern to advise the Ingrams to switch to an emergency source of heat. The pressure reduction in line caused a loss of heat greenhouse which was not discovered until 5:00 a.m. at time temperature in greenhouse was degrees zero and the contents then'a total loss. The Ingrams allege that South East negligence ern's in not warning them to switch to an emergency source of heat was proximate cause of their damages, in cluding loss inventory, profits, custom ers, labor, interest on money, borrowed damages. other In its judgment motion for plead- on the ings, South Eastern contended both that the trial court subject lacked juris- matter diction to hear Ingrams' complaint be- cause the Ingrams had failed to exhaust remedies and legis- that lature had vested jurisdiction exclusive to consider claim in the Indiana Utility Regulatory (IURC). Commission Wolf, addition, William H. South Burrow, argued Eastern R. Michael Burrow, Wolf & Greenfield, had failed to Stephen state a upon T. claim Taylor, Fitch Taylor, & Greensburg, for relief granted. could be The In- appellant-defendant. grams moved to depositions have their pub- lished urged the trial court to consider Emry, Franklin, John for appellees-plain- South Eastern's motion under Ind.Trial tiffs. Rule 56. South objected. Eastern court did not consider the depositions when ROBERTSON, Judge. ruling upon the motion judgment for on the South Eastern Indiana Co., Natural Gas pleadings. (hereinafter Inc. referred to as South East- Accordingly, the standard for re ern) brings this interlocutory appeal from view of South Eastern's motion is the same an order denying its motion for judgment as that applied to an Ind. Trial Rule on the pleadings in an action negligence 12(B)(6) motion solely made plead on the brought by Frank and Ingram (In- Donna ings. The motion tests the sufficiency of grams). the complaint to claim, state a redressable We affirm. not the facts support it. Anderson v. allege in their complaint (1979), Ind.App., Anderson 399 N.E.2d that, January 10, Eastern, 405-6. The test to applied whether, in 1. by We are informed South Eastern in its brief Texas Gas Corp., supplier Transmission pressure "[the reduction in was caused natural to South Eastern Gas." gas regulator malfunction of a owned denied, Ind., to the nonmovants cert. 485 N.E.2d light most favorable 687; 90 L.Ed.2d regarded U.S. intendment every and with v. Public Service Chicago sufficient to & E.I.R. Co. favor, complaint is their (citing 592, 594, 49 Id. State any valid claim. (1943), 221 Ind. constitute Commission Accordingly, any N.E.2d doubt 260 Ind. 341-2. v. Rankin plead- authority the facts must be 604). admits The movant the existence about authority. finding against 405-6. Anderson, resolved N.E.2d at ed. Michigan Ind. & Electric v. Rural United date, can be there this late At Ind., Electric circuit dispute serious jurisdic subject matter original has court sounding negligence. a claim tion to hear explicitly stated that legislature Had the ("The circuit court Ind. 38-4-4-8 Code law of modify the common it intended ... in all civil cases jurisdiction original has that the provided expressly is con jurisdiction exclusive except where duty in utility's scope of a existence and upon other courts by law ferred determined citizens is to be private tort jurisdiction"); State territorial same the Public Service Commis- exclusively by Schuetter 5 IURC, implemented as sion Act notwith grant This us. It not be before dispute would present position is that Eastern's standing, South Therefore, must we stated. has not so in authority to the IURC the by granting the intent from legislature's determine the act whatsoever any "practice or vestigate authority contained specific grants of any the service of affecting relating to or Act as a whole. 8 and the Title any ser complaint public utility" or unreasonable, ... any respect "is in vice a statu provides 8-1-2-107 Indiana Code inadequate," I.C. 8-1-2- or insufficient ... a con sustained as remedy injury tory "fix[ing] just and to issue an order the or violation of neglect sequence of a measurements, regulations, reasonable utility. This court by a regulatory scheme furnished, acts, service to be practices or brought pursuant to held that an action has fu followed in the imposed, observed aas damages sustained section for this unjust be those found to ture in lieu of in service utility's discrimination of a result 8-1-2-69, pre ...," legislature has 1.G. pre must be preference unreasonable jurisdiction over the an exercise of cluded by the IURC by a determination ceded trial complaint by an Indiana Ingrams' Indiana utility's is unlawful. conduct court, East requiring dismissal. South (1978), Friedland Telephone Bell Co. two considerations: contention raises ern's 622, 654, Ind.App. 373 legal first, any of the if denied, 440 U.S. 99 S.Ct. factual cert. questions posed But, 8-1-2-107 neither I.C. L3Ed.2d grant of "exclusive" within the IURC's the violation speaks to nor Friedland second, existence of dоes the authority, and utility. The by a law duties common juris the IURC's issue within a collateral has held that Supreme Indiana Court courts to defer consider require the diction displace the to not intend legislature did the IURC entire matter until ation of the by en to duties respect law with common acted. has section. to this acting predecessor Memorial De Pauw the Trustees Jennie begin our discussion with We Alba v. New Church Episcopal Methodist derives its proposition that the IURC basic if legislature; 193 Ind. power solely from the ny Waterworks there 8-1-2-107 Code by N.E. conferred power act has not been to authority to deter no grants the IURC legislature fore statute, exist. The it does not of a liability underlying facts or greater mine the grant to other and does not intend dispute litigant in a private utility to fit to exer authority than it has itself seen neglect or viola v. North cise. Action Coalition does not involve Citizens regulatory scheme. Co. ern Indiana Public Service legislature has explicitly givеn Eastern could therefore petition file a un- authority, IURC the upon its own mo der 1.C. 8-1-2-54 to obtain a declaration of tion, 8-1-2-58, I.C. or when liability the issue is Eastern's Ingrams. to the properly it, otherwise presented to to inves Nonetheless, by empowering tigate into the provided by reg "service" the IURC to determine the reasonableness utility, ulated to upon find facts based adequacy of South Eastern's service to it, evidence before prospectively and to rec customers, its appears possess tify any perceived inadequacies in the utili authority inherent investigate into ty's practices or the regulatory scheme. whether South Eastern used reasonable 8-1-2-54, 1.C. 69. Inherent in grant provision care in the of service and whether power is implicit power and authority some other action was warranted under the to do that which necessary to effectuate circumstances. inquiry While an into the regulatory scheme. Northern Indiana reasоnableness of provided the service Public Service Co. v. Citizens Action Co South Eastern ultimately may necessary (1989), Ind., alition 153, 158, to effectuate the regulatory scheme, the denied, cert. U.S. results of such an investigation can have 90 L.Ed.2d 687. binding upon effect the judiciary. The possesses only power such as the The courts of this state have al legislature can constitutionally ready concluded that the IURC does not upon confer it. possess power to make declaratory rul ings in the manner contemplated by the The Indiana Constitution ex Declaratory Judgment Act. U.S. Steel pressly reposes power to find facts Corp. v. Northern Indiana Public Service jury guarantees I, in Art. 20 that § cases, all right civil of trial "[iJn trans. denied. The TURC's en shall remain inviolate.2 Schembri v. ter orders upon impartial ‍‌​​​​‌‌‌‌​​​‌​‌​​​‌‌‌​‌‌‌‌‌‌‌​​​‌​​​‌‌​​‌​‌​​​‌​‍based findings of (1935), 97, Shearer 208 Ind. 194 N.E. 615. fact. It has not empowered been to enter The provision constitutional means that the judgments which determine parties' the incidents, substantial elemеnts and which rights, status legal relationship, even pertained by to a trial jury law, at common subject when the matter of the determina shall not be changed by altered or appears to fall within the IURC's legislature or the preserved courts and are grant broad authority. of National Rural they substance as existed at common Utilities Cooperative Corp. Finance v. law. Hayworth (1959), v. Bromwell 239 Public Service Commission Indiana 430, 437, Ind. 285, 158 of N.E.2d 288. Analo (1990), Ind., 23, 552 N.E.2d 25 (summarily gously, the Seventh Amendment of the fed affirming National Rural Coop Utilities eral prevents Constitution Congress from erative Corp. Finance v. Public Service depriving litigant jury a of a trial in legal Commission (1988), Indiana action before a tribunal customarily utiliz of 95, 98); 528 N.E.2d Utility Con ing a jury fact-finding as its arm. Atlas Office of sumer Counselor v. Northern Indiana Roofing Co. v. Occupational Safety &

Public (1989), Service Co. Ind.App., 538 Health Review (1977), Commission 430 957, 959, N.E.2d denied; trans. 7, Kentucky- U.S. 458-9 n. 1261, Municipal Indiana 1267, 7, Power Association 1267 n. 51 v. Hence, LEd.2d 464. Public Service Commission Indiana just as the General Assembly may not di of (1979), 639, 181 Ind.App. 645, 393 N.E.2d rectly right withdraw the jury to a in the 776, 780. Neither nor present South by cause legislation, Schembri, 208 right 2. The by jury to a fully protected trial 289, is 293, 815, 817; 243 Ind. 183 N.E.2d Allen v. all causes where it existed in 1851 when the (1877), (Constitution's Anderson 57 388, Ind. 389 adopted. Constitution was Yergin Hiatt v. "civil cases" means all civil actions at common law, including (1972), 497,514-5, Ind.App. 834, 152 284N.E.2d case). Consequent- action on the part, overruled in 411 N.E.2d 653. An ly, jury are entitled to a trial of action property in tort damage for is such negligence their they claim if so choose. City cause. Terre Haute v. Deckard of adequacy matter of the Hiott, upon the collateral 615; 284 N.E.2d 99, 194 N.E. Ind. at We addressed Eastern's service? of South by right impair it not at as substituting question IURC for last in Public Service precise fact-finding Nichols, arm. Indiana, court's v. Inc. raising a plaintiff held that a in which we in legislature never Plainly, claim need not ex law common delegation of

tended an unconstitutional also, remedies.3 See haust overlap be the factual power. Whatever Telephone Corp. v. Indiana Bell the reasonable investigation into tween App. 171 Ind. Telephone Co. utility's adequacy particular of a ness and Ind.App. modified, 171 of a com proof of the breach service (construction of breach 360 N.E.2d 610 empowered duty, the IURC is mon law judi proper claims matters for of contract rulings findings and to make factual to admin without resort cial determination jury. This binding upon ultimately Gas & Coke agency); of istrative Citizens that the issue power means want IURC, Ind.App. "exclusively" Utility never before Sloan neglect (fraud and rescission of alleged when the N.E.2d 290 judicial gov proper the common branch required of it contracts ed to act as implementing ernment). analysis than the Act or its The Michols court's law rather of breach the issues reme regulations, because the exhaustion of application damages are duty, proximate cause negligence and strict liabili dies doctrine to directly the IURC. not ever before utility governs ty against claims to the rationale this case. We would add Nonetheless, operative facts following points. of Nichols complaint do presented an exercise of the IURC's show a basis for First, def our case law dictates therefore jurisdiction. We investigatory only jurisdiction of the IURC erence to the referred to question come to second remedy from IURC is available where that the IURC mindful of the fact earlier: contemplates the determination motion, can, juris exercise its upon its own relief upon which further precise issue pro investigate into the service diction and depends, not the determi in the trial court Eastern, judiciary must the vided Friedland, issues. dismiss the because nation of collateral at 352.4 Ind.App. ruling go to the IURC for a did not first primary jurisdiction not well devel- acknowledges implicitly is trine of at least 3. The dissent Indiana, Nickols, may agree oped that it precedential 494 N.E.2d but we the effect of primary aрproach. of When the doctrine distinguishes allegation better Nichols' 349, but the provide jurisdic- rea- that "PSI had breached its jurisdiction applies, the court retains by permitting adequate services agency sonable and addresses action while the tion over the stray voltage Koch, PSI lines to the to flow from jurisdiction. C. question within its the dairy ground farm" on the and onto the Nichols' (1985). The & Practice 117 Administrative Law remotely only with ground dealt hand, that Nickols exhaustion, on the other requirement of adequate there was questions of service because Review is of the action. forces a dismissal provided an question service was no the consideration of whether circumscribed to a merely adequate one of level. The distinction authority, scope agency the of its acted within to take into account semantics and fails by findings supported agency's whether the allegations complaint specific the Nichols' of the decision is con- and whether the evidence authority. apparent of the IURC's breadth argues trary that the Eastern to law. Id. South and most is used ... in its broadest "Service' require- of administrative remedies exhaustion "accommoda- sense" and includes the inclusive compels the conse- dismissal. Given ment authority IURC's afforded customers." The conclusion, address quences we must of such a © any expressly which is "in extends to service argument. ... or in- unreasonable, ... insufficient respect application suggests of the supplied.) dissent (Emphasis ..." primary jurisdiction a dismiss- doctrine dictates within the IURC's part the case is al because of applies the doctrine of 4. The Friedland decision However, "[oluly jurisdiction. where exclusive require- primary jurisdiction than the rather pleaded can be seen as original as claim of exhaustion of remedies as a means ment of by Commis- necessarily requiring a decision necessity analyzing for deference. The doc- principle distinguishes This basiс all three Airlines, (1976), v. Allegheny Inc. 426 U.S. 290, 306, 96 S.Ct. upon by 48 L.Ed.2d of the decisions relied South East- ern, Haggard (1991), Energy, upon v. PSI Inc. but the test of reasonable care dismissed; arising trans. from common wholly law-a dis dependent tinct standard largely upon Forge Co., Indiana and Machine Inc. v. Co., upon Northern circumstances of Indiana Public Service the case and what a jury may Friedland, reasonably prudent N.E.2d 910 decide a per and support of its assertion that son would have done under the cireum- given opportuni- IURC must first be stances. ty investigate provide remedy. and special It takes no expertise to re involve, part, These cases at least in claims solve the question. To the con damages arising dependent out and trary, questions duty, duty, breach of upon validity application and of rules causation, injury and traditionally fall tariffs, contained in the utilities' ap- en competence within the of the judiciary proval regulation and of which is within the and its fact-finding jury. The law is the exclusive of the IURC. province judiciary of the under our consti Haggard, (State 575 NE.2d at 687 law system government. tutional Board of arising claims out pur- of denial of service Trustees Ind., PERF v. Miller tariff); suant to retail Forge, 733. Deference is not (Consolidated N.E.2d 910 appeal. of orders granted agency's legal conclusion. Id. emergency petitions and for An IURC determination of adequacy "the declaratory injunctive relief and dam- of service" is unnecessary thus because it ages by implementation caused allegedly question is not the jury the court or must arbitrary unreasonable containment because, regardless address and policy); Friedland, (Class 378 N.E.2d 344 facts by and law found the agency, neither declaratory action for injunctive relief nor the court by will be bound damages upon based claims discrimina- IURC's determinations. tion in rate tariff arbitrary and unreason- Second, neither prospective discre able, applied in arbitrary and discriminato- tionary "fixing" authorized 1.C. 8-1-2- ry manner wrongfully applied). The 69 nor the internal complaint procedure Ingrams make challenge any provi- offered provide IURC can In- sion in Indeed, South Eastern's tariff. relief, grams any "remedy" is no there is no indication in the any record that remedy at all for a common law tort and in provision in the tariff or even an IURC respect, plainly it is inadequate. Cf. regulation applicable to South Eastern's - McCarthy v. Madigan, U.S. allegedly negligent practice. -, (fed 117 LEd.2d 291 But, precisely, more brought the action prisoner eral need not resort to internal ultimately grievance "does not turn procedure before he initiate on a determination of the reasonableness of damages; Bivens suit for justices all con challenged industry practice-a determi- cur, grievance procedure fact that cannot nation that could by be facilitated in- provide an damages award of means adminis formed evaluation of the economics or tech- remedy trative furnishes no effective reme nology regulated of the industry," Nader dy all). plaintiff compelled go sion should the jurisdiction be points to first by doctrine toward deference Jaffe, L., courts, to the Commission. Judicial analysis Control entails more than (1965). Administrative Action 138 simply looking "any Accord part" to see whether of an 616, Telephone Corp., Indiana Ind.App. 171 jurisdiction 358 action is within the exclusive of the fortiori, N.E.2d 218. A agency, Airlines, there e.g. should not be a Allegheny Nader v. Inc. cf. (if (1976), 290, dismissal prejudicial) 304-5, 1978, 1987, dismissal would be 426 U.S. agency power 643; where the give is without to Peabody 48 L.Ed.2d v. Massa Coal Co. party may (S.D.Ind., relief to which a 1988), be entitled under F.Supp. 698 the correct Jaffe, governing the law the cause of action." jurisdic result would be for the court to retain

Judicial IURC, Control pending Administrative Action by 138. a decision to Assuming application then primary that of the dismiss the action. Third, statutory procedure may Duties which be the basis only by may review excludes commоn law remedies of a action arise statute by operation Morgan of law. State v. statutory provisions to the extent preserve (1982), adequate ‍‌​​​​‌‌‌‌​​​‌​‌​​​‌‌‌​‌‌‌‌‌‌‌​​​‌​​​‌‌​​‌​‌​​​‌​‍protect to sub 432 N.E.2d imposes upon Indiana Code 8-1-2-4 rights guaranteed by the stantive Constitu tion, general principles statutory duty statute or of law. Eastern to furnish reason City ably Public Service Commission v. In service and facilities. See Telephone (1956), Indiana Bell v. O'Bryan dianapolis 235 Ind. N.E.2d 308; Forge (1980),Ind.App., Indiana & Machine Co. 408 N.E.2d 181. But v. apart statutory duty, from this the courts Northern Public Service Co. (1979), App., long Ind. 913. Ulti of this recognized state have a com mately, jury permitted reject if the duty part public is not mon law of a determination and factual find IURC's to conform its conduct for the benefit of ings adequacy public customers, on the reasonableness and generally, its service, very persons might of South Eastern's sub reasonably third who by foreseen to utility's pro be affected right protected stance of the trial by the Indiana will havе been vision of service. Constitution impaired. v. Johnson St. Vincent's Cf. parties present in the case oc Hospital, Inc. 273 Ind. cupy relationship buyer the contractual (Opinion pan N.E.2d 585 of medical review applicable and seller. All law force at evidence). only el This concern is not illu agreement impliedly the time the was made sory. e.g. Whitley County Rural part agreement any forms a of the without Membership Corp. Lippincott Electric v. statement to that effect. Strauss Veal (1986), Ind.App., 493 N.E.2d 1323. Feeds, Hunt, Inc. v. Mead & Inc. reasons, For these we conclude that 299, 302, Ind.App., 538 trans. de correctly trial court determined that Hence, required nied. South Eastern is IURC did not have exclusive by provide both statute and contract to Ingrams' over the issues raised com- reasonably adequate with ser plaint. complaint Dismissal of the was not duty vice and has a to conform its conduct warranted because of the pur- required through to that of it the IURC ported failure to exhaust regulаtions. its remedies. However, Alternatively, South Eastern the source of South argues have failed to Eastern's duty solely common law is not upon state a claim which relief can be , the contractual relation. Public utilities granted public because it owed the no that have received from authorities duty of provide reasonable care under the cireum- franchises which for the accommo general public dation of the in return issue, owe analyzing stances. we only sufficiency be concerned with the public to the as well as all individuals complaint claim, who, to state a not the facts in compliance of that with es support Only it. appears where it rules, tablished customs or make a demand certainty from the face of privi for the beneficial use utilities' plain under no set of facts could the leges advantages. Indianapo Coy v. granted appropri tiff be relief is dismissal lis Gas Co. Ind. Rankin, Thus, ate. 606. Notice N.E. it in Coy was held pleading plaintiff essentially means that a Indianapolis gas utility's Gas Co. that a plead only operative need supply gas facts involved to its customer with for failure litigation. Again, in the Id. promptly reserve, gave fuel and without allege proximate cause their of rise to an claim of actionable breach of tort, duty duty imposed by apart a law injury was South Eastern's warning them to switch emergen to an any duty from and in addition to under the cy source of heat. 662, duty contract. at 46 The Id. N.E. 17.

952 utility of a to escape gas); use reasonable care in the Tyner, Ind.App. 484, 49 gas imposed by distribution of law for a (Gas 97 N.E. at 585 company duty owed to utility conveys second reason: a dan customers, patrons occupants and of build gerous instrumentality. See Southern ings supplied agency where it to use care (1912), Tyner Indiana Gas Co. v. Ind. 49 danger commensurate with to which it ex App. 475, 97 N.E. 580. posed persons property). or Undeniably, duty the contours of this already shaped by been thе courts of upon decisions, Based these the al Coy this state. Indianapolis v. Gas Co. legations of Ingrams' complaint state a nonperformance holds that the of a con upon granted. claim which relief can be supply by utility tract to is an action were customers of South wrong. able In Public Service Comm'n v. upon Eastern who relied public it as a (1947), Pipeline Panhandle Eastern utility which potentially danger handles a 662, 686, 224 117, Ind. 71 affirmed, N.E.2d ageney continuously ous to supply gas at a 507, 190, 128, 332 U.S. 92 L.Ed. pressure, constant oversight exercise duty public utility required that it furnish a prompt remedy. Although the serve on reasonable terms all those who alleged consequences of South Eastern's desire the service it renders. Indiana duty breach of are not the same as in Coy, Illuminating

Natural & Long Gas Co. v. Long, Roberts, imposition duty of a (1901), 219, Ind.App. 410, 27 59 N.E. this depend upon should not the nature of dam court held that the common duty law ages which flow as a result of its breach. required gas reasonable сare utility to pain anguish Just as much can result gas furnish natural patrons to for domestic suffering from a devastating economic loss safe, use at a pressure, uniform to institute physical as for injury. Webb v. Jarvis and maintain an system efficient of over , (1991) Ind., 992, sight to ensure pressure that the continued uniform, to be safe and and to furnish a duty Eastern treats al prompt remedy for accidents and defects.5 leged in complaint as if it Roberts v. Indiana Gas & Water Co. poses question, a novel urging us to reeval (1966), 140 Ind.App. obligation uate its balancing under the test rehearing, Ind.App. 140 221 employed by Supreme the Indiana Court in N.E.2d stands for the proposition that Jarvis, 575 N.E.2d 992. The dissent would duty produce to and distribute in a adopt approach. this We are bound reasonably safe prudent manner re principle of stare decisis not to do so. Al quired distributors to warn consumers though the cases cited odorizing explic above do not gas they supply. There are itly weigh the three consideratiоns many other recognizing cases applying law now duty. also, openly recognizes factor into Richmond Gas legal (1897), equation duty, Co. v. Baker Gariup 146 Ind. 45 Con cf. (Gas N.E. 1049 utility owed all (1988), struction Ind., Co. v. Foster 519 persons might injured who N.E.2d be these holdings to use ordi have im nary plicitly in delivering public care balanced policy sub concerns for residence); stance to nearly one City Indianapolis years: hundred the interests of v. Walker Ind.App. 283, plaintiff customer legal entitled to (Gas utility protection against must exercise ordi utility's conduct nary care in line); maintenance of when it reasonably West foreseeable Corp. Gas v. Hill Ind.App. plaintiff injured will the utility's acts field or omissions. We cannot simply ignore (Duty 169 N.E.2d 726 to use reason required gas able care utility prevent these cases or import holdings. of their case, factually In a municipal similar greenhouse water agreed to a upon pressure at the utility was found to be "liable to the same extent days. City number of Huntingtоn Morgen private as a injury citizen private for tortious Ind.App. 162 N.E.255. rights" where the supply failed to water the the did not constrict that therefore reasons consumer The dissent And, au the IURC's utility's duty. while independent an present does not it sufficiently empower to thority the is broad claim because negligence law common utility public gas utili a governing here is that of rules a relationship promulgate to instance, the IURC has not conduct in this ty's the IURC its customers liability under utility from regulatory frame relieve a cannot within its determined in Indiana negligence to as it exists responsibility law of utility's public that work adopt. Indianapolis it by any service and rule reasonably furnish (1939), 107 its cus duty to warn Co. v. Schoenemann includes a Water facilities utility If the 308, 671. Ind.App. 20 N.E.2d in reduction unexpected tomers when the com public under duty to owes interruption in service pressure line abrogated or law, distinguishing duty cannot be mon dissent is either The ‍‌​​​​‌‌‌‌​​​‌​‌​​​‌‌‌​‌‌‌‌‌‌‌​​​‌​​​‌‌​​‌​‌​​​‌​‍occurs. adopted by order by regulatory care from reasonаble set aside utility's duty to use This is so because that a Id. he the IURC. duty to or believes warn authority. Id. legislative duty of reasonable has no law utility's common Lippincott, con N.E.2d 1323. with its But ef. precisely co-extensive care is response statutory Our or duties.6 tractual question, the General Without is two-fold. abrogate or power Assembly has tort, Dague Indiana, First, law there are no modify the common in duty. Neal v. degrees of 520, 275 Ind. Piper Co. Aircraft 160, fails but when it Builders, 418 N.E.2d 232 Ind. Inc. Home express imposes in terms so either The law to do 285. duty is duty and pre one common law must implication, but we unmistakable legislature (citing aware Trac sume that care. Id. Union use due any intend and does 188 Ind. common law Berry Co. v. for all 655). duty the same Casualty N.E. Fire Co. change. Farm & State relations, regard to the facts Division, without King Seely Thermos v. Structo duty to the so-called (1989), Ind., case. Id. It includes Berry, Co. v. Union Traction warn. See of 1.0. 8-1-2-107 legislature's enactment (duty of carrier 121 N.E. 655 supplant 188 Ind. the common intended to was not prоtection reasonable care for to use duties governing law remedy or the law any duty to warn of passengers includes Albany its it. Wa merely codify New but crossing). Con danger bridge terworks, imminent N.E. 540. Ind. exists, due care duty if a to use sequently, In- concluded The trial court the conditions to consider it is for relief upon a claim grams had stated by the evi circumstances disclosed con- agree We with granted. be could actions, precau and determine dence conclude that Accordingly, we clusion. should tions, of conduct which or course South Eastern's properly court denied trial up to measure pursued order have been pleadings and judgment on the motion for imposes. the law Union duty to the judgment. affirm Co., 121 N.E. at 188 Ind. at Traction Judgment affirmed. out, Second, points the dissent C.J., SHARPNACK, concurs. addressing the no IURC rules there are Ingrams. by the NAJAM, J., separate duty alleged with dissents breach opinion. utility and its The contract between pressure to conditions due parties' variatiоns in line briefs to dissent also looks to

6. The interruption of a TR. beyond service On review "fact" that the its control. by any motion, act or omission of South 12(B)(6) not caused with the was not concerned we are incongru- conclude that it would Eastern to intervention, third or defenses facts, party Eastern to a to warn to hold South ous complaint. sufficiency of the but when, regulation, responsible it is not NAJAM, Judge, dissenting. pressure. in reduction line Record at 4. parties agree The also in their statements respectfully I dissent. South Eastern is arguments appeal of fact and that there public utility regulated by the Indiana allegation is no that South Eastern caused ("IURC" Utility Regulatory Commission interruption gas of the ser- "Commission") pursuant to Indiana Code Appellant's Appel- vice. See Brief at 3 and 8-1-2-1, seq. question presented et The § lees' Brief at 1 and 2. squarely primary jurisdic- falls within the IURC, tion of the and it is for the IURC to The previously IURC has defined ade- determine, instance, in the first whether in quate service in this An context. reasonably adequate order "to furnish ser- provides rule that "if it can be shown that public utility vice and facilities" a re- gas pressure occurring variations are quired to warn its customers when an un- beyond due to conditions the control of the expected interruption gas service occurs. utility," utility "shall not be deemed to Further, IND. CODE 8-1-2~4. even § have violated" the rule that pressure primary subject if the trial court had mat- vary by fifty percent shall not more than jurisdiction, ter South Eastern was entitled pressure. above below normal IND.AD- judgment on its motion to dismiss for 5-1-21(A) (B) MIN.CODE tit. r. failure to state a claim because South East- (1992). Thus, the judg- IURC has made a duty ern Ingrams had no to warn the as a determined, ment and within the regulatory matter of law. framework, adequate what constitutes ser- vice and what utility practice is reasonable

Primary Jurisdiction when, case, as in experi- this a customer Both the majority and the ences a in gas pressure. con reduction line Ingrams' complaint tend that the presents When a claim includes issues within the ordinary claim, simple ac competence of agen- both an administrative tion in tort for property damage, and that ey courts, and the primary doctrine of elements of and reasonable care jurisdiction provides agency that the should questions common law which fall out first regu determine those issues within its side of the primary jurisdiction. IURC's latory authority. See Egnatz Shlens v. majority The reasons that resort to the Ind.App., trans. and, hence, IURC would be futile is not primary jurisdiction denied. The test for required provide because the IURC cannot parts is not whether some of the case are with the trial to which jurisdiction within the exclusive of the they are damages entitled or to compensate courts; rather, the test is whether some However, them injury. for their major parts of the case are within the exclusive ity issue, avoids the real which is whether a agency. Forge trial court or the IURC should first deter and Machine Co. v. Northern Indiana mine existing whether IURC rules ensure Public Service Co. service to I customers. Davis, (quoting Adminis believe that task initially is committed 19.07, (1958)). trative Law Treatise at 89 § the IURC for a determination of the rea primary jurisdiction applies doctrine sonableness of policy, followed when a claim cognizable in a court but action in the trial court consistent with the adjudication of requires the claim adjudica IURC's determination.1 tion of issues regulatory under a scheme Throughout proceedings, these par- which are within special competence ties described event triggering expertise of an body. this action as a "reduction in pres- line Hansen v. and Western Railway Norfolk sure." allege (7th do not in their Cir.1982), 689 F.2d 711. Un complaint that South Eastern caused cireumstances, der those the court action is Any party brings who review, before the judicial to this pursuant court IURC and is dissatisfied with the Commission's Indiana Code § 8-1-3-1. may appeal final decision directly thаt decision action, refer- suspended pending law not dismissed but claim as a common by agency policy con they actually challenge for determination ral of such issues cerning adequacy utility pro of service body. Id. Eastern, by a matter which the vided recognizing In the seminal decision Subject-matter jurisdic regulates.2 IURC jurisdiction, the Su primary of doctrine by controlled the nature of the claim tion is con that a fundamental preme Court noted pleading. presented, by not the manner of consis promote is to cern of the doctrine poli uniformity in administrative Shlens, 46; tency and at 508 N.E.2d Public Service Railway Co. v. cy. Texas & Indiana, See Nichols Inc. v. Pacific 349, purposes pri (1907), 204 U.S. of 353. For Abilene Oil Co. Cotton 553, 355, 426, 440-41, 350, L.Ed. 27 51 S.Ct. jurisdiction analysis, the mere fact mary Hence, jurisdiction doe- primary 559. in one plaintiff phrases that the his claim reasonableness applied where the trine is does not conclu manner instead of another practices is administrative standards of sively jurisdiction; applica determine Peabody Massa v. Coal Co. issue. See bility primary of the doctrine 1446, (S.D.Ind.1988), F.Supp. 1451. 698 rely upon pleader. the whim of the does expertise to administrative Court deference Railroad United States Western Pacific regulated in appropriate in particularly is 59, 68-69, 161, (1956),352 U.S. systematic a and interrelat dustries where 167, 1 L.Ed.2d factfinding policymaking body ed conflicting provides com require uniformity expressly to avoid An rule that a IURC the courts. agency mands from the public utility not violate the minimum does Aman, gas pressure when and William T. allowable variations Alfred C. Jr. See (1998); 424 Mayton, Administrative to conditions Law such variations are due be Jaffe, Ad Louis L. Judicial Control utility. 170 yond the control of the (1965). ministrative Action 5-1-21(B). require rules IAC While IURC other circum notice to customers under interrup a an Notice to customer when stances, public require rules do not a IURC utility practice occurs is or service a provide unexpected notice of an utility to relating to that service. affecting act or Thus, Ingrams characterize their while the gas pressure.3 The IURC has reduction in schedules, rates, tolls, regula- granted ing charges, legislature specifically has said Our regulate addressing power IURC the matters act, or com- tions, measurements, practice of, adequacy plained the [CJlommis- of service: "The Commission shall shall be entered regulations hearing." establish reasonable rules sion without formal added). (emphases Fol govern public IND.CODE 8-1-2-54 § utilities and the relation between any investigation complaint or all classes of its customers." IND.CODE lowing made an 8-1-2-34.5(a). Further, against utility, § authorized the Commission is unreasonable, correcting any against any public orders "Upon issue made mercantile, inadequate practice or utility by any agricultural insufficient or service. or man- majority ufacturing society by any body politic As the See IND.CODE 8-1-2-69. § or mu- observes, (10) grant nicipal organization persons, correctly inherent in that or ten authority implicit power to do that which is the or firms, associations, or ten corporations (10) any necessary regulatory complainants scheme. of all or of the afore- to effectuate classes, by any utility, Service Co. v. Citi mentioned or See Northern Indiana Public rates, tolls, (1989), Ind., any charges sched- or Action Coalition zens denied, any joint S.Ct. ules or rate or rates in which such cert. 476 U.S. petitioner directly any are in L.Ed.2d 687. interested respect unjustly or discrimina- unreasonable regulation, measurement, utilities, or 3. Unlike electric and water the IURC tory, any affecting relating require gas practice provide custom- or act whatsoever or does not utilities to any public utility, any utility to the service intentional- ers with notice even when the therewith, any ly interrupts Compare service in connection is in re- IND.AD- service. unreasonable, utilities) unsafe, (gas spect or un- MIN.CODE tit. r. 5-1-23 insufficient justly discriminatory, any (1992) or that service is tit. r. 4-1- with IND.ADMIN.CODE obtained, (1992) (electriс utilities) inadequate or can not be and IND.AD- [CJom- notice, proceed, (1992) (water mission shall with or without utili- MIN.CODE tit. r. 6-1-22 ties) (utilities investigation notify, possible," to make such as it deem "so far as shall necessary seriously or convenient. But no order affected those customers most affect- A utility

primary jurisdiction to determine whether determination that has a its standards ensure service for to warn its customers unexpected when an customers under those interruption circumstances and in service occurs will have a whether impact standards consistent with direct on the cost of service and the contrast, policy. rates, if the had economics of which a trial promulgated requiring a rule obligation notice to cus court has expertise to con- circumstances, impact tomers under these a claim sider. The rates which re- challenging sufficiency sult imposition of that notice from the liability of tort in rather prac than the reasonableness of the this сontext is more "merely than inciden- properly tice itself could Nader, decided 300, tal." 426 U.S. at 96 S.Ct. at 1985, or 48 LEd.2d applying princi majority's trial court settled at 652. The opinion ples has broad of tort law. Nader ramifications Allegheny See v. because Airlines, liability tort 290, under these Inc. 426 U.S. n. circumstances 306 14, open could 1978, floodgates litigation wide the of 14, 96 S.Ct. 1988 n. 48 L.Ed.2d 643, 14; Massa, 656 n. F.Supp. by utility see also 698 customers an unexpect- whenever interruption ed in utility results, (primary at service jurisdiction 1451 ap doctrine example, in perishables the loss of has plies challenges where issue reasonable an impact adverse on a operation. business agency practices, ness of standards or compliance standards); with Citizens Gas This presents case also the kind of broad Utility and Coke 150 Wells Ind. policy question which ‍‌​​​​‌‌‌‌​​​‌​‌​​​‌‌‌​‌‌‌‌‌‌‌​​​‌​​​‌‌​​‌​‌​​​‌​‍calls for a consistent App. 323, (trial 327 court general uniform rule of application subject jurisdiction has matter to hear com promulgated by regulatory authority. plaint alleging negligent violation of rule Indeed, the need for a uniform policy requiring written notice to customer before governing notice to customers in the event shutting gas service). off Ingrams' The unexpected interruptions in ser- challenge action does not negligent vio paramount vice is weighs in heavily lation of a rule but the reasonableness of primary jurisdiction favor of in the IURC. policy which require does not notice When there is no administrative rule or to customers gas unexpect when service is regulation place in regulates edly interrupted. Nader, 426 at U.S. challenged practice, court action will nei- 305, 1987, 96 S.Ct. at 48 L.Ed.2d at 656. of, ther uniformity threaten the nor create Primary jurisdiction in, inconsistency Ingrams' an to decide the regulatory frame- challenge is vested in the IURC. work. at See id. 96 S.Ct. at 656; L.Ed.2d at Aman Mayton, supra, & at I disagree majority's with the contention Here, however, 430 n. 82. the IURC has require action does not already defined utility prac- reasonable an informed evaluation of the economics or tice when gas pressure reductions in occur technology industry. See id. The beyond due to conditions the control of the relies, majority's position part, in on the utility. See 170 IAC 5-1-21. majority The fact that the do not couch their approves a may subject result which utili- complaint in terms of an attack on the ties such conflicting as South Eastern to validity application of the IURC tariff. commands from our courts and the IURC However, a tariff is not an abstraction. regarding utility's duty notify custom- Pacific, Western at U.S. T7 S.0t. unexpectedly ers when service is interrupt- 167, 1 LEd.2d at 188. It embodies ed. The disrupt effect is to the desired analysis of technical cost-allocation and ac- goals uniformity consistency in the counting problems which must be solved in regulatory framework. TURC's setting the initially. tariff Id. "Courts which do not make rates cannot know with majority's conclusion that the trial exactitude the factors go into court has to decide the reаson- making process." ableness of rate- pro- South Eastern's failure to Id. at 77 S.Ct. at 167, 1 LEd.2d at 183. vide with notice enables the interruption

intentional in service in interruption). advance of and cannot award powers for the judgment "to substitute its court any money judgment. However, the reasonableness agency's ... on See id. when the doctrine Nader, previously applied 426 U.S. at 299- we have [utility] practice." declared that primary jurisdiction, at 652. we have 48 L.Ed.2d 96 S.Ct. at existing damages cannot cireumvent the with a claim for Ingrams are dissatisfied pass upon require primary jurisdiction to do not IURC's rules which practice. In interruptions specific utility Indiana Bell unexpected notice when (1978), 175 occur. The reasonableness gas service Telephone Co. v. Friedland 344, trans. de Ind.App. the IURC's is a matter within those rules Massa, primary jurisdiction. See nied, denied, cert. U.S.

F.Supp. at 1451. 1233, 59 LEd.2d 465 we held that even Commission, though the Public Service instance the agree I cannot predecessor, authority IURC's had dispositive. Nick- holding in Nickols plain money judgment, before a render had ols, whether the IURC we considered damages, the bring can a claim for tiff dairy in a over an action which jurisdiction first determined must have Commission voltage from a injured by stray herd was gave or which rise to that the conduct acts that company's lines and concluded power "unlawful." See id. the were raising negligence plaintiff a common law a Ind.App. at 878 N.E.2d at 852. relief from the need not first seek claim against proper procedure The for attacks NMichols,494 N.E.2d at 8354. Commission. public utility a practices and services of Michols, "the However, noted in as we from the is first to seek a determination only by the Nichols' claim presented issues practices those Commission whether adequate remotely questions dealt with instituting adequate an services are before contemplated by 8- as IND.CODE service damages. in the trial court for Id. action question no that ser- 1-2-54. There was reviеw of that determination Judicial adequate provided, it was at an vice was provided in Indiana Code obtained as ap- were quantity and the rates level and 8-1-8-1. Id. § Instead, involved propriate." Id. Nichols the IURC of The cannot divest utility's failure to its customers warn intended statutory jurisdiction and the stray voltage problem its potential for a of the merely by obtaining relief procedure product in placement its of an unsafe Ingrams' commerce, money damages. The questions claiming the stream concepts governed by traditional challenges adequacy of South claim Here, utility and the reason- liability. Eastern's service negligence and strict Id. practice. rule or Ac- Eastern ableness of contend that South Ingrams' complaint must cordingly, in that provide adequate failed to service primary jurisdiction. yield to the IURC's duty Eastern had the to take whatev- to restore steps necessary er were both

adequate and to warn its customers Failure to State a Claim service interruption prevent in of the service If, I dissent for a second reason. as Appel- damage property. to life and See holds, subject the trial court had majority lees' Brief at and 8. Eastern jurisdiction, matter then South support judgment in the entitled to on its motion to majority The finds further was to state a claim principle from that the trial court dismiss for failure because Mickols duty as a original subject matter over South Eastern had to warn has 12(B)(6). can- matter of law. Ind.Trial Rule action because See action, duty ex- complete not afford them relief. See Nick- whether ols, question of v. majority 494 N.E.2d at 858. The con- ists is a law. Jarvis Webb Ind., Among require tends that to to seek making in that relief from the IURC would be futile be- the relevant considerations only relationship between cause the IURC can exercise adminis- determination are the parties, foreseeability reasonable legislative powers, judicial or has no trative persons reasonable would person injured, public poli- not believe harm to the ey question duty whether recognize agree concerns. Id. that a to warn imposes duty begins with an the law utility should bear the loss exists analysis relationship between arising from a for each of its customers parties. Id. failure to warn. id. See Here, relationship is a contractual law, Apart from the common whether relationship public utility and its between a utility its and when a has warn is entitled to ade customer. customer customers is controlled ‍‌​​​​‌‌‌‌​​​‌​‌​​​‌‌‌​‌‌‌‌‌‌‌​​​‌​​​‌‌​​‌​‌​​​‌​‍service, and administered quate as defined find, parties I rule. do not and neither the regulations by the IURC under rules to, majority any directed me nor have Whitley have the effect of law. See requirement any applicable in stat notice Membership Corp. County Rural Electric contrary, ute or IURC rule.4 To the (1986), Ind.App., Lippincott law, matter IURC has determined as a Nevertheless, even where ser rule, utility service is adequate, unexpected interruptions vice when, case, as in this a reduction in from to time service occur time pressure exceeding allowable variations is warning usually and are caused without beyond the due to conditions control of equipment failure or weather con adverse 5-1-21(B). utility. An IURC IAC improvements technology While ditions. frequency reduced the and duration pursuant legislative grant rule issued to a interruptions, interrup of such occasional authority regulate provision of service, utility inherent in tions are utility service has the effect law. See expect customers them. (applying Lippincott, 493 N.E.2d principle promulgat to administrative rule interruptions they When such occur of- Commission, ten affect thousands of customers. As a ed the Public Service matter, practical usually customers predecessor). grant That IURC's au actual, immediate, knowledge exclusive, often that an thority to the IURC is and a trial occurred, interruption utility in has servicе court cannot create new or different rules obviously and in such cases notice is not notice, requiring or standards where the required. presents This case a more nar- already has rule determined that question, namely, row whether utility service is and that a is not utility duty has a to warn those customers responsible gas pressure in variations might who not know have the means at beyond due to conditions its control. See promptly interruption hand to learn The rule id. is not mere evidence in service has occurred. controlling. but id. See presupposes claim noted, previously Ingrams As did not duty South Eastern had a to warn and allege in interrup- their that the assumes, law, as a matter of the cus- in utility by any service was caused act in having uninterrupted tomer's interest Eastern, omission South and both utility protection service is entitled to parties agree that is not an issue. See against utility's warning in conduct 4; Appellant's Record at Brief at 3 and unexpected interruption the customer of an Appellees' Brief at 1 at 2. Given IURC Gariup service. See Construction Co. Ingrams rules effect at the time the (1988), Ind., v. Foster experienced However, gas a reduction in pressure, customers do not have a legitimate expectation duty South Eastern had that utilities will no- no as a matter of tify them under I give these circumstances. do law to notice of the inter- contrast, ruption only requires § In Indiana Code 8-1-2-122 re- service utilities to quires reports notice of termination of residential elec- maintain records and file of such inter- gas service, tric or and Indiana Administrative IND.ADMIN.CODE tit. r. 5- ruptions. (1992). 1-23 There are no IURC rules which Code, title rule 4-1-23 no- requires planned interruptions require gas utility tice of of electric notice to customers of unin- single addressing interruptions service. IURC rule inter- tentional of service. reasonably ade- ruption in order to furnish

quate service. or ad- common law apply a

Whether we legal analysis, there is law

ministrative legal the absence of duty In to warn. state a have failed to

claim.

Conclusion sum, Eastern was I that South believe law as a matter of judgment

entitled subject mat- lacked the trial court

because Further, jurisdiction.

ter upon which relief a claim

failed to state theory, either granted. Under

could be judgment for a Eastern's motion granted. have been pleadings should BURKE, Sr., Appellant- E.

James

Petitioner, BURKE, Appellee-Respondent. J.

Sandra

No. 45A05-9207-CV-235. Indiana, Appeals

Court of

Fifth District.

July21,1993.

Case Details

Case Name: South Eastern Indiana Natural Gas Co. v. Ingram

Court Name: Indiana Court of Appeals

Date Published: Jul 19, 1993

Citation: 617 N.E.2d 943

Docket Number: 69A01-9208-CV-263

Court Abbreviation: Ind. Ct. App.