Opinion
Court of Appeals Case No. 18A-CT-828
09-16-2019
Kenyon TYUS, Jr., Kyrie Tyus, Keyon Tyus, Amber Tyus, and Kenyon Tyus, Appellants/Cross-Appellees-Plaintiffs, v. INDIANAPOLIS POWER & LIGHT COMPANY, The City of Indianapolis, Indianapolis Department of Public Works, and Wright Tree Service Inc. d/b/a Wright Tree Service, Appellee/Cross-Appellant-Defendant.
Attorneys for Appellants: William E. Winingham, Jonathon B. Noyes, Wilson Kehoe Winingham, LLC, Indianapolis, Indiana, Ned Miltenberg, Washington, D.C. Attorneys for Amicus Curiae Indiana Trial Lawyers Association: Tyler J. Zipes, Nicholas C. Deets, Hovde Dassow & Deets, LLC, Indianapolis, Indiana Attorneys for Appellee Indianapolis Power & Light: Joshua B. Fleming, Lucy R. Dollens, Quarles & Brady LLP, Indianapolis, Indiana, T. Joseph Wendt, Alejandra Reichard, Barnes & Thornburg LLP, Indianapolis, Indiana Attorneys for Appellee Wright Tree Service Inc.: Kevin C. Schiferl, Amy Stewart Johnson, Darren A. Craig, Frost Brown Todd LLC, Indianapolis, Indiana Attorneys for Amicus Curiae Indiana Energy Association: Wayne C. Turner, Patrick A. Ziepolt, Hoover Hull Turner LLP, Indianapolis, Indiana Attorneys for Amicus Curiae Indiana Legal Foundation: Jane Dall Wilson, Emily Kile-Maxwell, Faegre Baker Daniels LLP, Indianapolis, Indiana
Attorneys for Appellants: William E. Winingham, Jonathon B. Noyes, Wilson Kehoe Winingham, LLC, Indianapolis, Indiana, Ned Miltenberg, Washington, D.C.
Attorneys for Amicus Curiae Indiana Trial Lawyers Association: Tyler J. Zipes, Nicholas C. Deets, Hovde Dassow & Deets, LLC, Indianapolis, Indiana
Attorneys for Appellee Indianapolis Power & Light: Joshua B. Fleming, Lucy R. Dollens, Quarles & Brady LLP, Indianapolis, Indiana, T. Joseph Wendt, Alejandra Reichard, Barnes & Thornburg LLP, Indianapolis, Indiana
Attorneys for Appellee Wright Tree Service Inc.: Kevin C. Schiferl, Amy Stewart Johnson, Darren A. Craig, Frost Brown Todd LLC, Indianapolis, Indiana
Attorneys for Amicus Curiae Indiana Energy Association: Wayne C. Turner, Patrick A. Ziepolt, Hoover Hull Turner LLP, Indianapolis, Indiana
Attorneys for Amicus Curiae Indiana Legal Foundation: Jane Dall Wilson, Emily Kile-Maxwell, Faegre Baker Daniels LLP, Indianapolis, Indiana
Kirsch, Judge.
[1] In the underlying action, Amber Tyus ("Amber"), her husband, Kenyon Tyus ("Kenyon"), and their three children, Kenyon Tyus, Jr. ("Kenyon, Jr."), Keyon Tyus ("Keyon"), and Kyrie Tyus ("Kyrie") (collectively, "the Tyuses") sued Indianapolis Power & Light Company ("IPL"), among others, for various acts of common law negligence and gross negligence. The Tyuses, who were not IPL customers, sought recovery for injuries sustained when Amber and her three children were involved in an automobile accident at a busy Indianapolis intersection where IPL-operated traffic signals remained dark for more than eight hours after they were disabled by a storm. IPL moved for judgment on the pleadings based largely on the defense that IPL's schedule of rates, rules, and regulations for supplying electricity to customers ("the 2016 Tariff"), which had been filed with and approved by the Indiana Utility Regulatory Commission ("IURC") on March 16, 2016, provided a release from liability. Specifically, IPL argued that Rule 24.2, in part, released IPL from liability for injuries to third persons resulting from an interruption of service or supply of electricity, "unless due to willful default or neglect on the part of [IPL]" ("the Release Clause"). Appellee's App. Vol. 4 at 91. The trial court granted IPL's motion for judgment on the pleadings as to the Tyuses' negligence claim but allowed their claim of gross negligence to proceed to trial.
[2] The Tyuses bring this discretionary interlocutory appeal raising five constitutional issues, of which we find the following issue to be dispositive:
On appeal, the Tyuses claimed that the IURC's approval of the Release Clause of the 2016 Tariff: (1) violated due process because customers and noncustomers were not notified of the change in the immunity language, and the trial court made no findings and heard no evidence; (2) violated separation of powers by encroaching on powers entrusted to the legislature and to the judiciary; (3) violated separation of powers by exceeding the power delegated to the IURC by the legislature; (4) violated the equal privileges and immunity clause by granting IPL, as an investor-owned utility, a special immunity; and (5) violated the one-subject rule by grouping together the IPL's immunity from tort law with customer contractual issues.
I. Whether the trial court erred in granting IPL's motion for judgment on the pleadings, after finding that the Release Clause precluded IPL from being liable to the Tyuses for damages resulting from IPL's negligent interruption in the supply of electricity, when, the Tyuses argue, the IURC's act of approving the Release Clause exceeded the IURC's delegated powers.
IPL cross appeals raising three issues, which we restate as:
IPL contends that: (1) it did not owe the Tyuses a duty of care to protect them from a car accident; (2) the Release Clause was inextricably connected to rate making and, therefore, fell within the IURC's expertise and jurisdiction; and (3) Indiana does not recognize degrees of negligence and, therefore, the Tyuses' claim for gross negligence cannot survive as a freestanding claim. Because we find that the Tyuses' claim for negligence may proceed, we need not address IPL's issue regarding degrees of negligence.
II. Whether the Tyuses are barred from raising a constitutional issue for the first time on appeal;
III. Whether the trial court and our court lack subject matter jurisdiction because the Tyuses' suit is an improper collateral attack on the 2016 Tariff; and the Release Clause is inextricably connected to rate making and, thus falls within the IURC's expertise and jurisdiction; and
IV. Whether, even without the Release Clause, judgment on the pleadings for the Tyuses' negligence claim is appropriate because
IPL owes the Tyuses no duty of care.
[3] We affirm in part, reverse in part, and remand for further proceedings.
Oral argument was held on June 27, 2019 at Purdue University's Krannert Graduate School of Management. We extend many thanks. First, we thank counsel for the quality of the oral and written arguments, for participating in post-argument discussions with the audience, and for commuting to West Lafayette, Indiana. We especially thank the Executive Education Program at the Krannert Graduate School of Management for their accommodations and the students in the audience for their thoughtful post-argument questions.
The Accident
[4] During a storm on the afternoon of April 2, 2016, a tree branch fell, downing power lines near the intersection of Binford Boulevard and Kessler Boulevard ("the Intersection") in the City of Indianapolis, Indiana ("the City"). The resulting power outage caused IPL-operated traffic signals at the Intersection to go dark at 3:14 p.m. that day. Appellants' App. Vol. 2 at 66. An hour later, at 4:14 p.m., IPL "was notified that the entire electrical circuit" at the Intersection had lost power. Id. at 67. About twenty-five minutes later, at 4:39 p.m., IPL was notified that the traffic signals and surrounding lights at the Intersection were out in every direction. Id. At 8:26 p.m., about five hours after the traffic signals had lost power, IPL "was again notified in an emergency call" that the traffic signals and lighting at and surrounding the Intersection had no power. Id. By 11:00 p.m., IPL "had received at least thirteen separate notifications that the [I]ntersection's circuit had lost power." Id. At 11:17 p.m., about eight hours after the traffic signals initially went black, the Intersection and its surrounding street lights were still completely without power and there was no traffic control at the Intersection. Id.
[5] That night, around 11:20 p.m., Amber was driving westbound on Kessler Boulevard with her three sons—ten-year-old Kenyon, Jr., seven-year-old Keyon, and two-year-old Kyrie. Id. at 68. As Amber entered the Intersection, her vehicle was t-boned by a vehicle operated by Brian Ruark who, with passenger Jonell Carrier, was traveling northbound on Binford Boulevard. The crash caused catastrophic injuries to members of the Tyus family. Id. Amber suffered severe fractures and other orthopedic injuries. Id. Kenyon, Jr. suffered a severe traumatic brain injury and is now confined to a hospital bed without the ability to walk, talk, or feed himself. Id. Kyrie suffered a severe traumatic brain injury, rendering him unable to form sentences or have normal control over the left side of his body. Id. Keyon suffered bodily injuries and severe emotional damage after witnessing the crash and his family's condition. Id.
Jonell Carrier was also injured in the accident and sued the same defendants that the Tyuses had sued. On July 3, 2018, the trial court consolidated the case of Carrier v. Indianapolis Power & Light Company ; The City of Indianapolis; Indianapolis Department of Public Works; and Wright Tree Service Inc. d/b/a Wright Tree Service , Cause No. 49D13-1803-CT-12557, into the underlying Cause Number 49D12-1612-CT-43871. Appellants' App. Vol. 2 at 28-29. The consolidation was deemed appropriate because Carrier: (1) was a passenger in the vehicle that hit the Tyuses' vehicle; (2) was injured as a result of that collision; and (3) sued the same defendants named in the instant case. Carrier does not participate in this interlocutory appeal.
[6] IPL is a domestic, investor-owned, electric utility. In 2016, pursuant to a "Public Lighting Contract" between the City, as customer, and IPL ("the IPL Contract"), IPL supplied equipment and electricity to the City's traffic signals, including those at the Intersection. The IURC is an administrative agency of the State and "has legislative authority to set rates or charges for regulated public utilities, including electric utilities." Ind. Energy Ass'n Amicus Br. at 9. IPL is subject to regulation by the IURC.
The Indiana Administrative Code provides, " ‘Investor-owned utility" means any utility that is financed by the sale of securities and whose business operations are overseen by a board representing their shareholders." 170 Ind. Admin. Code 4-1-23(a)(6).
The IPL Contract covered a period from July 15, 2011 to December 31, 2017. Appellants' App. Vol. 5 at 172-88.
Procedural History
[7] On December 9, 2016, the Tyuses filed their initial complaint against IPL seeking damages for injuries sustained. Thereafter, the Tyuses filed an amended complaint and, thereafter, a second amended complaint on May 17, 2017 ("the Amended Complaint"). Appellants' App. Vol. 2 at 43-53, 54-64, 65-77. In the Amended Complaint, the Tyuses alleged that IPL "knew or should have known of the power outage at the intersection of Binford Boulevard and Kessler Boulevard in Indianapolis, Indiana for over eight hours prior to the Tyus[es]' collision." Id. at 69. The Tyuses further alleged that IPL uses a system to locate outages that became outdated decades ago. Specifically, the Tyuses alleged:
In its original complaint, the Tyuses also named as a defendant Eric Wasson, who had been at the Intersection soon after the accident; the Tyuses later dismissed Wasson from the suit and added Wright Tree Service Inc. as a defendant. Appellants' App. Vol. 2 at 65.
[IPL] was negligent and careless in one or more of the following respects:
a. Failing to properly monitor and maintain the power to the [I]ntersection.
b. Failing to timely and properly restore power to the [I]ntersection after power to the [I]ntersection was lost.
c. Failing to properly maintain power lines and trees in order to prevent power outages.
d. Failing to use a reasonable system for diagnosing and correcting power outages in [the City].
e. Failing to act as a reasonable utility in regard to maintenance, monitoring, and upkeep of traffic signals in [the City].
Id. at 69-70. The Tyuses further alleged that IPL's "conduct constitute[d] gross negligence and reckless misconduct in view of its failure to restore power to the traffic [signals] and street lights at a high[-]volume intersection for a period in excess of [thirteen] hours." Id. at 70. IPL filed its answer on June 6, 2017.
[8] On September 12, 2017, IPL moved for judgment on the pleadings because the IURC-approved 2016 Tariff "preclude[d] IPL's liability for damages resulting from interruptions in the supply of electricity," and the matter should be referred to the IURC for its interpretation of the meaning of the 2016 Tariff. Id. at 81. IPL also moved to dismiss the Tyuses' claims, arguing that IPL did not owe the Tyuses a duty of care and, as such, the Tyuses' "[Amended C]omplaint fail[ed] to state a claim upon which relief can be granted against IPL as a matter of law." Id. In its motion for judgment on the pleadings, IPL relied in large part on its belief that the IURC-approved 2016 Tariff provided a complete defense to the Tyuses' claims. Specifically, IPL focused on the following italicized language of the Release Clause:
24 Release of Company from Liability.
....
24.2 [IPL] shall not be liable for damages resulting to the Customer, or to third persons, from the use of electricity , interruption of service or supply , or the presence of the [IPL]'s property on the Customer's premises, unless due to willful default or neglect on the part of [IPL].
Appellee's App. Vol. 4 at 91. Based upon this limitation of liability in the 2016 Tariff, IPL argued that it was shielded from the liability asserted against it in the Tyuses' Amended Complaint, and, therefore, the Tyuses' claims against IPL failed as a matter of law. Appellants' App. Vol. 2 at 36. IPL alleged that the Release Clause "preclude[d] IPL's liability for damages resulting [to the Tyuses] from interruptions in the supply of electricity ...." Id. at 81.
[9] In the alternative, IPL argued that the instant case be referred to the IURC. It was IPL's position that "both of [the Tyuses'] negligence claims against IPL, at root, challenge the reasonableness of IPL's service," and that "[t]hat claim cannot be adequately resolved without the IURC's knowledge, perspective and expertise regarding reasonable utility practices, viewed as part of the larger electrical and regulatory systems." Id. IPL argued that, "[a]t a minimum, pursuant to the doctrine of primary jurisdiction, [the Tyuses'] claims against IPL should be stayed and referred to the IURC before those claims proceed further, so this Court can have the benefit of IURC's expertise on the reasonableness of IPL's service." Id.
[10] The trial court held a hearing on December 13, 2017, during which IPL argued that the Tyuses' claims should be dismissed or referred to the IURC pursuant to the doctrine of primary jurisdiction. Tr. Vol. II at 8-9. IPL maintained that there was an "absence of the [trial] court's subject matter jurisdiction" and an "absence of common law duty from IPL to [the Tyuses]." Id. at 10. Furthermore, IPL cited the "wisdom and utility" of referring the Tyuses' case to the IURC "to utilize its expertise in determining the reasonableness of IPL's actions." Id. While recognizing that a trial court has the general power to resolve negligence claims, IPL asserted that such resolution is only appropriate where "that claim doesn't require consideration and regulation of an IURC order." Id. at 21. IPL argued that, here, the trial court lacked subject matter jurisdiction over the Tyuses' claims because "resolution of the viability, scope, and substance of the plaintiffs' claims depend[s] upon the interpretation, application of two IURC orders." Focusing on the Release Clause, IPL asserted that the IURC-approved limitation to IPL's liability precluded the Tyuses, as third parties, from recovering for any injuries arising as the result of any negligent actions IPL may have committed in connection with interrupting the supply of electricity to the traffic signals.
IPL referred to the following two orders: (1) the 2016 Tariff; and (2) an order applicable to the standards of tree trimming. Tr. Vol. II at 13. However, our resolution of the issues before us requires consideration of only the 2016 Tariff.
[11] On February 9, 2018, the trial court issued an Order granting in part and denying in part IPL's motion for judgment on the pleadings ("2018 Order"). The trial court determined that our court's decision in Prior v. GTE North , 681 N.E.2d 768 (Ind. Ct. App. 1997), trans. denied , stood "for the proposition that the Indiana legislature, through the IURC, had the power to restrict the Tyuses' common law right to bring an ordinary negligence action against IPL as a rational means of keeping IPL's costs to a minimum so that IPL is able to operate without charging its customers an unreasonable rate." Appellants' App. Vol. 2 at 38. Applying the Prior reasoning, the trial court dismissed the Tyuses' negligence claim against IPL. However, the trial court concluded that the 2016 Tariff did not foreclose the Tyuses' claims of gross negligence and reckless conduct.
[12] On February 20, 2018, the Tyuses filed their motion to certify the 2018 Order for interlocutory appeal. Id. at 179-84. IPL filed a motion to reconsider the 2018 Order, claiming that Indiana law "recognizes only negligence, not gross negligence." Appellee's App. Vol. 2 at 2. Following a hearing, the trial court denied IPL's motion to reconsider on March 19, 2018 and, that same day, granted the Tyuses' motion to certify the 2018 Order for interlocutory appeal. Id. at 26, 185. On April 17, 2018, the Tyuses filed with our court a motion to accept jurisdiction over interlocutory appeal, and IPL responded to that motion on May 2, 2018. On May 25, 2018, our court accepted jurisdiction over the Tyuses' interlocutory appeal.
We note that each the following organizations has filed an amicus brief: (1) Indiana Trial Lawyers Association ("ITLA"), which "regularly represent[s] Indiana citizens in personal injury and wrongful death actions" and has interests aligned with those of the Tyuses, ITLA Br. at 4; (2) Indiana Energy Association ("IEA"), which has interests "in fair rate making" and "avoiding legal rulings that would frustrate the intent or effectiveness of utility regulation," and counts IPL among its members, IEA Br. at 8; and (3) Indiana Legal Foundation, Inc. ("ILF"), which represents the interests of the business community where a "broad-based policy matter is at risk" and has interests aligned with those of IPL, ILF Br. at 5. We thank those organizations for their contribution to our consideration of the issues before us.
[13] The Tyuses appeal from that part of the trial court's 2018 Order granting IPL judgment on the pleadings as to the Tyuses' claim of negligence. A Trial Rule 12(C) motion for judgment on the pleadings tests the sufficiency of a claim presented in the pleadings. KS & E Sports v. Runnels , 72 N.E.3d 892, 898 (Ind. 2017). In considering a Rule 12(C) motion, courts must rule solely on the pleadings and "accept as true the material facts alleged in the complaint." Id. "All reasonable inferences are drawn in favor of the nonmoving party and against the movant." HealthPort Techs., LLC v. Garrison Law Firm, LLC , 51 N.E.3d 1236, 1238 (Ind. Ct. App. 2016), trans. denied. "A judgment on the pleadings is proper only where there are no genuine issues of material fact and the nonmoving party cannot in any way succeed under the facts and allegations therein." Id. We review a trial court's decision on a motion for judgment on the pleadings de novo . Id.
[14] The Tyuses contend that the issues for review in this case concern: (1) the constitutionality of the IURC's approval of IPL's Release Clause; (2) the IURC's jurisdiction to approve that Release Clause; and (3) whether the IURC acted contrary to law. Whether a statute, ordinance, or agency order is constitutional on its face is a question of law which this Court reviews de novo . Paul Stieler Enter., Inc. v. City of Evansville , 2 N.E.3d 1269, 1272 (Ind. 2014). Any issue regarding "[t]he [IURC]'s jurisdiction ... is a legal question that [appellate courts] review de novo ." Ind. Bell Tel. Co. v. IURC , 715 N.E.2d 351, 354 (Ind. 1999). "[A]n agency action is always subject to review as contrary to law, but this constitutionally preserved review is limited to whether the [IURC] stayed within its jurisdiction and conformed to the statutory standards and legal principles involved in producing its decision, ruling, or order." N. Indiana Pub. Serv. Co. v. U.S. Steel Corp. , 907 N.E.2d 1012, 1016 (Ind. 2009).
[15] On appeal, the Tyuses argue that the trial court erred in granting IPL's motion for judgment on the pleadings as to the Tyuses' negligence action. The Tyuses argue that, regardless of how the IURC would interpret the Release Clause, any approval by the IURC of language purporting to relieve IPL of liability for common law tort injuries to a noncustomer, when that injury occurs during IPL's interruption in the supply of electricity, would exceed the power granted to the IURC by the Indiana General Assembly. On cross appeal, IPL claims that the trial court's grant of IPL's motion for judgment on the pleadings as to the negligence claim should be affirmed because: (1) the Tyuses are barred from raising a constitutional issue for the first time on appeal; (2) our court lacks subject matter jurisdiction to consider the Tyuses' improper collateral attack on the 2016 Tariff; and (3) IPL owes the Tyuses no common law duty and, therefore, cannot be negligent as a matter of law. Because IPL's issues could be dispositive, we reorder the issues and address IPL's arguments first.
In the alternative, IPL argues that the resolution of this matter requires the interpretation and application of an IURC order, the 2016 Tariff, which is best addressed by the technical expertise of the IURC. That is not a jurisdictional issue.
I. Waiver of Constitutional Issues
[16] The Tyuses contend that, by approving the Release Clause, the IURC wandered far beyond its delegated powers, far beyond its ‘ministerial’ function, and far beyond its recognized ‘factfinding’ expertise"; specifically, they argue that "in approving the Release [Clause], the IURC violated six separate provisions of the Indiana Constitution and several provisions of its own regulations." Appellants' Br. at 24. IPL, in turn, argues that the Tyuses waived consideration of their constitutional arguments because, they raised most of them for the first time on appeal. Appellee's Br. at 32. Because the dispositive issue before us is whether the IURC exceeded its delegated legislative powers when it approved the Release Clause, we need only address whether that constitutional issue was preserved.
[17] IPL admits that the trial court heard argument on the question of whether the IURC exceeded the powers delegated to it by the legislature. Even so, IPL questions whether the Tyuses' argument was enough to preserve that issue for appeal. Appellee's Br. at 32. We find the following statements, made by the Tyuses' counsel during the trial court's hearing on the motion for judgment on the pleadings, adequately preserved this constitutional issue for appeal.
There is no indication at all that the legislature intended to modify the Tyuses' constitutional right to bring a bodily injury claim against a public utility, and that has to be either an unmistakable implication or a clear statement. You're not going to find anything in the statute that says that and IPL hasn't pointed to one statutory provision that shows that, nor has it pointed to even one statutory provision that gives the [ ] IURC the power to limit the Tyus family's constitutional rights. It doesn't exist.
Tr. Vol. II at 40. The Tyuses did not waive the constitutional issue regarding whether the IURC's act of approving the Release Clause exceeded the powers delegated to it by the legislature.
II. Jurisdiction
A. Standing
[18] IPL contends there is a jurisdictional bar to either the trial court or our court addressing or reviewing the IURC's approval of the 2016 Tariff and its included Release Clause. Indiana Code section 8-1-3-1, in part, provides:
Any person , firm, association, corporation, limited liability company, city, town, or public utility adversely affected by any final decision, ruling, or order of the [IURC] may, within thirty (30) days from the date of entry of such decision , ruling, or order, appeal to the court of appeals of Indiana for errors of law under the same terms and conditions as govern appeals in ordinary civil actions ....
[19] IPL first argues that the trial court did not have jurisdiction because, under Indiana Code section 8-1-3-1, the Tyuses could only appeal the IURC-approved 2016 Tariff directly to the court of appeals. See Schenkel Enters., Inc. v. Ind. & Mich. Elec. Co. , 182 Ind. App. 48, 51, 393 N.E.2d 268, 270-71 (1979) ( Indiana Code section 8-1-3-1 "provides the exclusive remedy for parties aggrieved by the [IURC]'s orders, and trial courts have no subject-matter jurisdiction over disputes arising from such orders."). IPL, however, has mischaracterized the Tyuses' claims. The suit the Tyuses filed with the trial court was not an appeal of the 2016 Tariff's Release Clause; in fact, it is likely that the Tyuses knew nothing about the Release Clause until IPL raised it as an affirmative defense. The Tyuses' Amended Complaint was filed as a common-law tort claim to recover for injuries the family sustained from the accident at the Intersection. Our Supreme Court has said, "If at least one of the issues involved in the case is within the jurisdiction of the trial court, the entire case falls within its jurisdiction, even if one or more of the issues are clearly matters for exclusive administrative or regulatory agency determination." Austin Lakes Joint Venture v. Avon Utils. , 648 N.E.2d 641, 646 (Ind. 1995). "Where at least one of the issues or claims is a matter for judicial determination or resolution, the court is not ousted of subject matter jurisdiction by the presence in the case of one or more issues which arguably are within the jurisdiction of an administrative or regulatory agency." Id. The trial court had jurisdiction to consider the Tyuses' Amended Complaint.
[20] IPL next argues that our court does not have jurisdiction because the Tyuses failed to follow the procedures required under Indiana Code section 8-1-3-1 to appeal. That is, IPL contends that the Tyuses have no standing to proceed with this action because they failed to show they sustained any direct injury as a result of the 2016 Tariff and, even if the Tyuses had sustained an injury arising from the 2016 Tariff, they did not initiate judicial review within the requisite thirty days after the IURC-approved that tariff. Appellee's Br. at 25-26 (citing Ind. Code § 8-1-3-1 ). Again, characterizing the Tyuses' appeal as a challenge to the 2016 Tariff, and noting that the Tyuses did not comply with Indiana Code section 8-1-3-1, IPL argues that our court lacks jurisdiction to hear this appeal because the Tyuses' arguments "are simply impermissible collateral attacks on an IURC-approved [2016] Tariff and rate order, in violation of the "doctrine of primary jurisdiction." Appellee's Br. at 13. We disagree.
[21] Contrary to IPL's assertions, our court's jurisdiction in this matter does not rest on the Tyuses' compliance with Indiana Code section 8-1-3-1. IPL correctly notes that the Tyuses showed no injuries arising from the IURC's approval of the 2016 Tariff's Release Clause. However, when IPL raised the Release Clause as a bar to the Tyuses' claims for negligence, IPL opened the door for the Tyuses to challenge that part of the 2016 Tariff as being invalid and unconstitutional.
[A] court may always properly inquire ... whether or not the order is contrary to law.... In other words, did the Commission stay within its jurisdiction and conform to the statutory standards and legal principles involved in producing its order? This is purely a legal question and a proper one for the courts to determine in any judicial review regardless of any statutory provision. These issues include questions of legality of the administrative procedure and violations of fixed legal principles as distinguished from questions of fact or expert judgment or discretion.
The Public Service Commission was the predecessor to the IURC. Hamilton Se. Utils., Inc. v. Ind. Util. Regulatory Comm'n , 101 N.E.3d 229, 231 (Ind. 2018).
Pub. Serv. Comm'n v. City of Indianapolis , 235 Ind. 70, 82, 131 N.E.2d 308, 312-13 (1956) ; see Citizens Action Coal. of Ind., Inc. v. Pub. Serv. Co. of Ind. , 582 N.E.2d 330, 333 (Ind. 1991) (court may properly inquire whether commission ruling is contrary to law); Ind.-Am. Water Co. v. Ind. Office of Util. Consumer Counselor , 844 N.E.2d 106, 110 (Ind. Ct. App. 2006) (quoting Lincoln Utils., Inc. v. Office of Util. Consumer Counselor , 661 N.E.2d 562, 564 (Ind. Ct. App. 1996) (court may inquire whether Commission remained within its jurisdiction and conformed to all relevant statutes, standards, and legal principles), trans. denied ). Because this appeal challenges whether the IURC stayed within statutory standards and legal principles in approving the Release Clause, our court has jurisdiction.
B. Primary Jurisdiction
[22] In the alternative, IPL argues that, because the matters before us pertain to the validity of the Release Clause, the resolution of which IPL argues requires an interpretation and application of the 2016 Tariff, the Release Clause is best interpreted by the IURC using its knowledge and technical expertise. Appellee's Br. at 33-35. Thus, IPL argues that the Tyuses' claims should be referred to the IURC pursuant to the doctrine of primary jurisdiction. We disagree.
[23] "The doctrine [of primary jurisdiction] comes into play when a claim is cognizable in a court but adjudication of the claim "requires the resolution of issues which, under a regulatory scheme, have been placed within the special competence of [an] administrative body; in such a case, the judicial process is suspended pending referral of such issues to the administrative body for its views." Moran Elec. Serv., Inc. v. Comm'r, Ind. Dep't of Envtl. Mgmt. , 8 N.E.3d 698, 702-03 (Ind. Ct. App.), aff'd on reh'g , 13 N.E.3d 906 (Ind. Ct. App. 2014), trans. denied . Here, there is no need for the "special competence" of the IURC because the issue raised by the Tyuses does not involve a complicated regulatory issue. Instead, the question is whether IPL had a duty to the Tyuses, whether IPL breached that duty, and whether that breach proximately caused the Tyuses' injuries. Furthermore, we need not refrain from deciding this case because, as our Supreme Court has found, "[t]he doctrine of primary jurisdiction is not, in our view, jurisdictional but prudential ...." Id. at 703. More importantly, the Tyuses are not challenging the rates or charges set by the IURC. Instead, they are challenging the legality and constitutionality of the IURC's approval of the Release Clause; a provision that bars noncustomers from recovering damages from IPL for personal injuries arising from IPL's negligence. [24] The Tyuses originally brought a common-law tort action against IPL, not an appeal of the IURC-approved 2016 Tariff, and, as such, the trial court had jurisdiction to hear their negligence claims. See S.E. Ind. Nat. Gas Co. v. Ingram , 617 N.E.2d 943, 949 (Ind. Ct. App. 1993) ("a plaintiff raising a common law negligence claim need not exhaust administrative remedies"). Moreover, the Tyuses were not customers of IPL; therefore, the rules and regulations contained in the 2016 Tariff, including the Release Clause, did not apply to them. See Ind. Code § 8-1-2-34.5(a) ("The [IURC] shall establish reasonable rules and regulations to govern the relations between public utilities and any or all classes of their customers."); 170 Ind. Admin. Code 4-1-29 ("all rules and regulations covering the relationship between the customer and the public utility shall be filed by each public utility in the office of the [IURC]"). The IURC's rules, regulations, knowledge, and expertise were irrelevant to the outcome of the Tyuses' negligence claim. Jurisdiction was properly in our courts of general jurisdiction.
III. Negligence
[25] Our Supreme Court has said, "we generally avoid addressing constitutional questions if a case can be resolved on other grounds." Girl Scouts of S. Ill. v. Vincennes Ind. Girls, Inc. , 988 N.E.2d 250, 254 (Ind. 2013) (citing Ind. Wholesale Wine & Liquor Co. v. State ex rel. Ind. Alcoholic Beverage Comm'n, 695 N.E.2d 99, 106 (Ind. 1998) ). Accordingly, we first address IPL's claim that the trial court properly granted its motion for judgment on the pleadings because IPL did not commit negligence as a matter of law. " ‘[T]o prevail on a claim of negligence the plaintiff must show: (1) duty owed to plaintiff by defendant; (2) breach of duty by allowing conduct to fall below the applicable standard of care; and (3) compensable injury proximately caused by defendant's breach of duty.’ " Goodwin v. Yeakle's Sports Bar & Grill, Inc. , 62 N.E.3d 384, 386 (Ind. 2016) (quoting King v. Ne. Sec., Inc. , 790 N.E.2d 474, 484 (Ind. 2003) ). "Absent a duty there can be no negligence or liability based upon the breach." Id. "Whether a duty exists is a question of law for the court to decide." Id. at 386-87.
[26] IPL argues that to determine whether a duty exists between IPL and the Tyuses, this court must consider our Supreme Court's decision in Webb v. Jarvis , 575 N.E.2d 992, 995 (Ind. 1991). Under Webb , the trial court must evaluate (1) the relationship between the parties, (2) the reasonable foreseeability of the harm to the person injured, and (3) public policy concerns. Id. at 995. "Duties [that] may be the basis of a negligence action may [also] arise by statute or by operation of law." Ingram , 617 N.E.2d at 951. While the trial court made no specific finding in the 2018 Order regarding the source of IPL's duty to the Tyuses, we agree with the Tyuses that, by allowing the gross negligence action to proceed, the trial court recognized that a duty existed.
IPL acknowledges that "[a] finding of no duty to [the Tyuses] would also require reversal of the trial court's order allowing [the Tyuses]' gross negligence claim to proceed." Appellee's Br. at 52 n.6. The Tyuses characterize this statement as a concession by IPL that "the trial court's decision to allow [the Tyuses] to proceed on their gross negligence claim is predicated on the lower court's finding that IPL owed a duty to [the Tyuses] ...." Appellants' Reply Br. at 14. We agree.
[27] In Goodwin , our Supreme Court, citing Northern Indiana Public Service Co. v. Sharp , 790 N.E.2d 462 (Ind. 2003), clarified that " ‘[a]lthough the Webb three-part balancing test is a useful tool in determining whether a duty exists, this is so ‘only in those instances where the element of duty has not already been declared or otherwise articulated.’ " Goodwin , 62 N.E.3d at 387 (quoting Sharp , 790 N.E.2d at 465 ). The Tyuses contend that IPL's duty arises from three strands of Indiana law, which reflect and reinforce each other: (1) a common law duty; (2) a statutory duty; and (3) our Supreme Court's adoption of the Restatement of Torts. Appellants' Reply Br. at 14. Regarding a common law duty, Indiana courts have long recognized that "[p]ublic utilities that have received from public authorities franchises which provide for the accommodation of the general public in return owe a duty to the public ...." Ingram , 617 N.E.2d at 951 (citing Coy v. Indianapolis Gas Co. , 146 Ind. 655, 659, 46 N.E. 17, 19 (1897) ). This duty to the public extends to "third persons" who are "affected" by the utility's actions or non-actions; i.e. , a utility's duties extend to individuals who are strangers to the utility's contracts with its "customers." Bamberger & Feibleman v. IPL Co. , 665 N.E.2d 933, 938 (Ind. Ct. App. 1996) ; see Heritage Operating, L.P. v. Mauck , 37 N.E.3d 514, 521 (Ind. Ct. App. 2015) (gas company's duty extends to public generally, its customers, and third persons who might reasonably be foreseen to be affected by utility's provision of service), trans. denied . "Embodied within this duty of care is ‘the so-called duty to warn.’ " Mauck , 37 N.E.3d at 522 ( Ingram , 617 N.E.2d at 953 ).
[28] The existence of a duty owed by IPL to public motorists like the Tyuses is reinforced by Indiana's statutes and the IURC's regulations. The Indiana General Assembly enacted Indiana Code section 8-1-2-4, which mandates that "[e]very public utility is required to furnish reasonably adequate service and facilities." The IURC, relying in part on the authority of that Code section, promulgated 170 Indiana Administrative Code 4-1-23, which addresses the duties owed by a utility to the public in the event of an "interruption of service." That regulation, in pertinent part, provides, "(d) Utilities shall first attempt to restore service that affects public health and safety. Each utility shall have written procedures for designated employees to follow in emergencies." 170 I.A.C. 4-1-23. Those procedures must include "at least the following": (1) notification procedures for emergency response personnel; (2) general location or locations of equipment, tools, and materials normally needed to restore service; and (3) procedures for notifying fire, police, medical, and other public officials. Id. As part of its regulations, the IURC defined the term "customer" and could have restricted IPL's responsibility to restoring service that affects just the health and safety of its customers . However, the IURC chose the words, "restore service that affects public health and safety." 170 I.A.C. 4-1-23(d). This language contemplates the IURC's intent to impose a duty on public utilities like IPL, in the event of an interruption of service, to act to protect the health and safety of the public.
For the purposes of electric utilities, the IURC defined the term "customer" to mean any person, firm, corporation, municipality, or other government agency that has agreed to pay for electric services received from a utility. 170 I.A.C. 4-1-1(c).
[29] A finding of duty is also supported by Section 43 of the Restatement (Third) of Torts, which provides:
In their Reply Brief, the Tyuses cite to Section 324A of the Restatement (Second) of Torts as support for their claim that IPL owes them a duty. Appellants' Reply Br. at 15-18. Section 43 of the Restatement (Third) of Torts, titled "Duty to Third Parties Based on Undertaking to Another," replaced, without substantive change, Section 324A of the Restatement (Second) of Torts. Section 324A, in part, stated that the duty to third parties applied regardless of whether the undertaking to provide services was done gratuitously or for consideration. Restatement (Second) of Torts § 324(A) (1965). As explained in the Section 43 comments, that language, while not included in Section 43 of the Third Restatement, is still applicable. Restatement (Third) of Torts § 43 cmt. a (Am. Law Inst. 2012) ("[O]mission of language contained in the Second Restatement specifically identifying gratuitous and contractual undertakings is for felicity of expression, not for substantive change."). Accordingly, IPL, who, for consideration, undertook to render traffic signal services—a duty owed to the general public by the City—owes the Tyuses the duty of reasonable care in conducting that undertaking.
An actor who undertakes to render services to another and who knows or should know that the services will reduce the risk of physical harm to which a third person is exposed has a duty of reasonable care to the third person in conducting the undertaking if:
(a) the failure to exercise reasonable care increases the risk of harm beyond that which existed without the undertaking,
(b) the actor has undertaken to perform a duty owed by the other to the third person, or
(c) the person to whom the services are rendered, the third party, or another relies on the actor's exercising reasonable care in the undertaking.
Restatement (Third) of Torts § 43 (Am. Law Inst. 2012). See Collip v. Ratts ex rel. Ratts , 49 N.E.3d 607, 616 (Ind. Ct. App. 2015) (citing Light v. NIPSCO Indus., Inc., 747 N.E.2d 73, 75 (Ind. Ct. App. 2001) (observing that "our decisions have equated Indiana law with the provisions of Restatement (Second) of Torts, § 324A," the predecessor to Section 43 of Restatement (Third) of Torts), trans. denied ). Restatement (Third) of Torts section 43 "applies to any undertaking to render services resulting in physical harm to third persons where there is negligence in the manner of performance ...." Collip , 49 N.E.3d at 616 (citation omitted). "The assumption of such a duty creates a special relationship between the parties and a corresponding duty to act [as] a reasonably prudent person. Failure to act ‘reasonably’ will ‘give rise to an action for negligence.’ " Medtronic, Inc. v. Malander , 996 N.E.2d 412, 420 (Ind. Ct. App. 2013) (citations omitted).
[30] Through the IPL Contract, IPL undertook, for consideration, the City's duty to operate the traffic signals, traffic signals that were erected for the benefit of the City's motoring public. The Tyuses were part of that motoring public. As such, IPL owed them a duty of reasonable care. Because the remaining two elements of negligence—breach of duty and injury proximately caused—are questions for a finder of fact, we cannot dismiss the Tyuses' negligence claim as a matter of law. See Mauck , 37 N.E.3d at 522 (breach of duty and proximate cause are best-suited for jury or fact finder to decide), trans. denied. Accordingly, we must address the question of whether the trial court erred in using the Release Clause as a basis for granting IPL immunity on the Tyuses' claim of negligence.
IV. The IURC's Delegated Power
[31] The Tyuses contend that the IURC's act of approving the 2016 Tariff's Release Clause was unconstitutional because it exceeded the powers delegated to it by the Indiana General Assembly. Specifically, they characterize the question before us as "whether the IURC's ‘lawful jurisdiction[ ],’ includes the power to rewrite the common law of torts and to immunize a public utility from claims by noncustomer third-persons that the utility's negligent interruption of service caused them to suffer personal injuries." Appellants' Br. at 44.
[32] Our court has described the powers of an administrative agency as follows:
"It is elementary that the authority of the State to engage in administrative action is limited to that which is granted it by statute[.]" Ind. State Bd. of Pub. Welfare v. Tioga Pines Living Ctr., Inc. , 622 N.E.2d 935, 939 (Ind. 1993), cert. denied (1994); see also Vehslage v. Rose Acre Farms, Inc. , 474 N.E.2d 1029, 1033 (Ind. Ct. App. 1985) ("It is black-letter law that generally, administrative agencies are creatures of statute, and only the legislature has the broad power to provide for their creation. Administrative boards, agencies, and officers have no common law or inherent powers, but only such authority as is conferred upon them by statutory enactment."). "Any act of an agency in excess of its power is ultra vires and void." Howell v. Ind.-Am. Water Co. , 668 N.E.2d 1272, 1276 (Ind. Ct. App. 1996), trans. denied (1997). "To maintain the proper balance between the departments of government, the courts have power to confine administrative agencies to their lawful jurisdictions." Wilmont v. City of S. Bend , 221 Ind. 538, 541-42, 48 N.E.2d 649, 650 (1943).
Planned Parenthood of Ind. v. Carter , 854 N.E.2d 853, 864 (Ind. Ct. App. 2006) ; see Adkins v. City of Tell City , 625 N.E.2d 1298, 1302 (Ind. Ct. App. 1993) ("Administrative entities are creatures of statute. As such, they cannot exercise power beyond that given in their creation.").
[33] Indiana Code section 8-1-1-2 provides for the creation of the IURC, whose purpose is to insure that public utilities provide constant, reliable and efficient service to its customers. Office of Util. Consumer Counselor v. Pub. Serv. Co. of Indiana , 463 N.E.2d 499, 503 (Ind. Ct. App. 1984). The Indiana General Assembly created the IURC " ‘primarily as a fact-finding body with the technical expertise to administer the regulatory scheme devised by the legislature.’ " Citizens Action Coal. of Ind., Inc. v. N. Ind. Pub. Serv. Co. , 76 N.E.3d 144, 151 (Ind. Ct. App. 2017) (quoting Ind. Gas Co. v. Ind. Fin. Auth. , 999 N.E.2d 63, 65 (Ind. 2013) (internal quotation removed)). Part of the legislature's charge is the requirement that the IURC periodically review and set each utility's rates for service. See Ind. Code § 8-1-2-42.5 (by rule or order, the IURC must require that basic rates and charges of all public utilities be subject to a regularly scheduled periodic review and revision by the IURC). General ratemaking is a "comprehensive" process, requiring the [IURC] to "examine every aspect of the utility's operations and the economic environment in which the utility functions to ensure that the data [the IURC] has received are representative of operating conditions that will, or should, prevail in future years." NIPSCO Indus. Grp. v. N. Ind. Pub. Serv. Co. , 100 N.E.3d 234, 238 (Ind. 2018), modified on reh'g (internal citation omitted). That examination results in the IURC setting a tariff and approving rules and regulations for the operation of that utility.
[34] To enable the IURC to carry out its responsibilities, the legislature conferred upon that agency the power to "formulate rules necessary or appropriate to carry out the provisions of [this] chapter." Ind. Code § 8-1-1-3(g). However, the legislature was limited in the power it could confer because the "legislature cannot delegate the power to make a law." Gunderson v. State, Ind. Dep't of Nat. Res. , 90 N.E.3d 1171, 1186 (Ind. 2018), cert. denied , ––– U.S. ––––, 139 S. Ct. 1167, 203 L. Ed. 2d 256 (2019). "Utility regulation is premised on a ‘regulatory compact’ in which the State sanctions a utility's monopoly within a defined service area and subjects the utility to various regulatory restrictions and responsibilities." NIPSCO Indus. Grp. , 100 N.E.3d at 238.
As a quid pro quo for being granted a monopoly in a geographical area for the provision of a particular good or service, the utility is subject to regulation by the [S]tate to ensure that it is prudently investing its revenues in order to provide the best and most efficient service possible to the consumer.
Id. (quoting U.S Gypsum, Inc. v. Ind. Gas Co. , 735 N.E.2d 790, 797 (Ind. 2000) (quotation and citations omitted)). In other words, IPL ceded to the State some of its autonomy in exchange for the State's grant that IPL would be the exclusive provider of electricity in a designated area.
[35] The State's regulation of IPL is through the IURC, "which is authorized by statute to act with ‘technical expertise to administer the regulatory scheme designed by the legislature ... to insure that public utilities provide constant, reliable, and efficient service to the citizens of Indiana.’ " Id. (quoting U.S. Steel Corp. , 907 N.E.2d at 1015 (citation omitted)). See Ind. Code §§ 8-1-1-1 to 8-1-1-15.
When exercising this authority, the [IURC] balances the public's need for adequate, efficient, and reasonable service with the public utility's need for sufficient revenue to meet the cost of furnishing service and to earn a reasonable profit. "Proper rates are those which produce a fair and nonconfiscatory return, and such as will enable the company, under efficient management, to maintain its utility property and service to the public, and provide a reasonable return upon the fair value of its used and useful property."
NIPSCO Indus. Grp. , 100 N.E.3d at 238 (emphasis added) (internal citations omitted).
[36] Our Supreme Court has held that "the legislature may only delegate rule-making powers to an administrative agency if that delegation is accompanied by sufficient standards to guide the agency in the exercise of its statutory authority." Gunderson , 90 N.E.3d at 1186. The IURC "derives its power and authority solely from statute, and unless a grant of power and authority can be found in the statute it must be concluded that there is none." Citizens Action Coal. of Ind., Inc. v. N. Ind. Pub. Serv. Co. , 485 N.E.2d 610, 612 (Ind. 1985). The legislature conferred upon the IURC the power to "formulate rules necessary or appropriate to carry out the provisions of [this] chapter." Ind. Code § 8-1-1-3(g). However, without additional specificity, we find no evidence that the legislature gave, or intended to give, the IURC power to shield IPL from liability for injuries caused by IPL's negligence to noncustomers. "[A]ny doubt about the existence of [IURC's] authority must be resolved against a finding of authority." Knox Cty. Rural Elec. Membership Corp. v. PSI Energy, Inc. , 663 N.E.2d 182, 189 (Ind. Ct. App. 1996) (citing Ingram, 617 N.E.2d at 947 ). Furthermore, although agencies may promulgate rules and regulations to implement the legislature's regulatory scheme, they are prohibited from adopting rules or regulations that are outside the scope of the power conferred by the legislature." Charles A. Beard Classroom Teachers Ass'n v. Bd. of Trs., 668 N.E.2d 1222, 1224 (Ind. 1996).
[37] Our Supreme Court recently reiterated:
"[T]he legislature cannot delegate the power to make a law." City of Carmel v. Martin Marietta Materials, Inc. , 883 N.E.2d 781, 788 (Ind. 2008) (construing
article IV, section 1 of the Indiana Constitution ). It can only "make a law delegating power to an agency to determine the existence of some fact or situation upon which the law is intended to operate." Id. (internal quotations omitted).
Gunderson, 90 N.E.3d at 1186. The legislature understands that it has the power to grant immunity and has done so on various occasions, including, under the Indiana Tort Claims Act ("ITCA"). See Ind Code § 34-13-3-3. However, even under the ITCA, immunity is the exception and not the rule. See Jacks by Jacks v. Tipton Cmty. Sch. Corp. , 94 N.E.3d 712, 716-17 (Ind. Ct. App. 2018), trans. denied ("The party seeking immunity has the burden of establishing that its conduct falls within one of the exceptions provided by the ITCA."). Here the legislature provided no specific language from which we can find that the legislature gave, or intended to give, the IURC the authority to shield IPL from liability for injuries caused to noncustomers by IPL's negligence.
[38] Public policy also supports our determination that the IURC had no authority to approve the Release Clause, which granted IPL immunity for its future negligent actions. IPL's position suggests that it deserves greater immunity than governmental entities enjoy for the same undertaking. "[P]rivatization of a governmental service is not ‘a farce in which the privatized entity enjoys the benefits both of not being the state and so being freed from the regulations that constrain state agencies, and of being the state and so being immune from suit.’ " Veolia Water Indianapolis, LLC v. Nat'l Trust Ins. Co. , 3 N.E.3d 1, 11 (Ind. 2014) (citation omitted)).
[39] The City and IPL share responsibility for the City's traffic signals. The City's responsibility arises from being a governmental entity; IPL's arises from a contract. The City's purpose is to serve the public; IPL must be responsive to its shareholders. Despite limited statutory protections under the Tort Claims Act, the City is responsible for maintaining traffic signals with reasonable care. Conversely, IPL asserts that it is not liable for its own acts of negligence. Traffic signals should be operational whenever reasonably possible because they are indispensable to public safety. Failing to enforce IPL's duty to energize traffic signals disincentivizes it from using reasonable care and shields it from negligence. Because IPL has the monopoly power over the City, the Release Clause constrains the City in its ability to incentivize IPL to act with reasonable care.
[40] The arrangement between the State and a utility is not a guarantee that a utility will suffer no unexpected expenses. The State grants the utility the benefit of a monopoly and enables "the company, under efficient management, to maintain its utility property and service to the public, and provide a reasonable return upon the fair value of its used and useful property." NIPSCO Indus. Grp. , 100 N.E.3d at 238. In Citizens Action Coalition of Indiana, Inc. v. Public Service Co. of Indiana , ratepayers complained that its rates were increased when the "IURC improperly adjusted its measurement of PSI's cost of equity based upon speculation that acid rain legislation would be enacted in the future, thereby damaging PSI's investment potential. 612 N.E.2d 199, 201 (Ind. Ct. App. 1993). Our court said that the IURC was correct in noting that PSI would be most heavily impacted should such legislation be enacted; however, the fact was that "no such legislation existed at the time of the order." Id. Reversing the IURC's order, our court said
IURC's discretion lies in the area of assessing the impact of known circumstances.
Forcing ratepayers to bear the weight of a calculation based upon speculation is not within the purview of the IURC's authority. The possibility of such legislation and its consequences demand the policy-making attention of the utility's management prior to its enactment, not the rate-making authority of the IURC. The adjustment for potential harm flowing from an uncertain event was error.
Id. at 201-02.
[41] The trial court erred in granting IPL judgment on the pleadings because the 2016 Tariff is unlawful and unreasonable to the extent it allowed IPL to grant IPL immunity from liability for personal injury or property damage caused to noncustomers, by IPL's own negligence, and in connection with IPL's interruption of service. Such grant of immunity was beyond the IURC's delegated authority and, therefore, that part of the Release Clause is ultra vires and void.
V. Prior
[42] The trial court decided this case with the understanding that our court's reasoning in Prior v. GTE North is controlling. In Prior , a customer of the telephone utility GTE, paid to have his business advertisement included in various GTE publications. 681 N.E.2d at 771. Prior timely paid for the ads; however, his business name was omitted from four separate publications for two years. Id. Prior contacted GTE regarding the omission, and it refunded the monthly charge for the omitted ads, but GTE, pursuant to the limited liability provision set forth in GTE's IURC-approved tariff, refused to reimburse Prior for his lost business revenues. Id. Prior sued GTE to recover those damages, claiming GTE had breached its contract and was negligent and reckless for not including his name in the telephone directories. Id. GTE filed a motion for summary judgment arguing that Prior's claims for damages were precluded by the limited liability provision of GTEs tariff. Id. The trial court granted GTE's motion for summary judgment, and we affirmed on appeal. Id. at 775.
[43] While we agree that the facts in Prior are similar, we find that case distinguishable. The injured party in Prior was a GTE customer. That difference is significant because, by the IURC's own administrative rules, the rate schedules, rules, and regulations cover the relationship between the customer and the public utility. 170 I.A.C. 4-1-29. The Tyuses were not customers of IPL and, therefore, were not bound by the provisions of the Release Clause. Prior is not controlling.
Summary
[44] The Tyuses brought this interlocutory appeal, claiming that the Release Clause was unconstitutional under various articles of the Indiana Constitution. IPL countered that our court does not have jurisdiction to hear this action, that it owes no duty to the Tyuses as a matter of law, and the Tyuses' claims of unconstitutionality are waived. As we discuss above, we find this court does have jurisdiction, IPL does owe the Tyuses a duty of reasonable care, and the dispositive constitutional claim that the IURC exceeded its delegated authority was not waived. We affirm the trial court's determination that the Tyuses' gross negligence action may proceed and reverse the trial court's grant of judgment on the pleadings as to the negligence action. We remand this case to the trial court for further proceedings not inconsistent with this opinion.
[45] Affirmed in part, reversed in part, and remanded for further proceedings.
Riley, J., and Robb, J., concur.