Indiana Supreme Court justices heard oral argument Thursday on the question of whether a utility may face liability for people injured in a traffic crash in which a malfunctioning stoplight played a role.
Justices heard Kenyon Tyus, Jr., et al. v. Indianapolis Power & Light Co., et al., 18A-CT-00828, considering first whether to grant transfer in the case.
A unanimous Indiana Court of Appeals panel previously reversed judgment entered for Indianapolis Power & Light on a claim of negligence brought by Kenyon and Amber Tyus, along with their children Kenyon Jr., Kyrie and Keyon.
The Tyuses sued IPL after Amber and her kids were involved in an accident that left them with catastrophic injuries. Traffic signals at an intersection Amber was passing through had been inoperable for about eight hours after a storm in April 2016, when her vehicle was T-boned by an oncoming vehicle.
A Marion Superior judge granted judgment on the pleadings to IPL on the family’s claim for negligence, but not on their claim for gross negligence. The appellate court later affirmed in part, reversed in part, and remanded, ruling that the Tyuses may proceed on both claims.
Speaking on behalf of IPL, attorney T. Joseph Wendt argued that the justices should grant transfer because the appellate court’s decision changes three fundamental aspects of decades-old utility law. If allowed to stand, Wendt argued, those changes would adversely affect both utilities and consumers.
First, he noted that by holding the IURC lacks authority to approve a liability limitation in a utility’s tariff, the opinion conflicts with the high court’s articulation of the IURC’s implied duties and the COA’s previous decision in Prior v. GTE North Inc., 681 N.E.2d 768 (Ind. Ct. App. 1997).
He also asserted that the COA’s opinion nullifies the exclusive legislatively created mechanism for a review of an IURC order, and in doing so, undermines the legislative balancing of interests that provide utilities needed certainty while still protecting the public interest.
Additionally, Wendt maintained that the appellate court’s decision imposes on IPL and all other utilities virtually unlimited tort liability.
“If allowed to stand, the Court of Appeals’ decision will dramatically change utility law for the worse and will impact consumers and utilities alike,” Wendt argued.
He further asserted that although it was the “sole linchpin which distinguished the prior decision” from the COA, the distinction between customers and noncustomers is not an issue in the case. Attorney Jonathon Noyes, representing the Tyuses, argued the contrary and asked the justices to deny transfer in the case.
“First, the COA’s opinion applies this court’s precedent and holding that the IURC never intended to abrogate or abolish or change the common law that utilities operate under when it created the IURC, nor did it give the IURC any authority over common law tort claims,” Noyes said.
“It also applied centuries-old precedent in holding that the IPL (has a) common law duty of care to the Tyus family. Additionally, this third-party release of liability that’s not available in the public market violates several sections of the Indiana Constitution,” Noyes argued.
Noting that his clients are not customers in the case, Noyes argued that the only customer in the case is the City of Indianapolis.
“You want us to look at one definition of customer,” Chief Justice Loretta Rush later addressed to Noyes. “I don’t know how practical that will be going forward… I don’t know if the customer versus noncustomer is enough to hold it.”
“Well, your honor, it’s a bright line rule that we’re proposing,” Noyes replied. “If you pay for a service, you’re a customer. If you don’t pay for the service, you’re not. That’s what separates a customer from a noncustomer and that’s how it would be in the private market, too.”
In contrast, Wendt posed the hypothetical: “Imagine an accident where one person in a car is a customer and the other person is a noncustomer. You’d have different rules applying to the different people involved in that same accident – the accident which implicates the exact same policy considerations for each of them. Each of them are oriented to the IURC in the same way and each of them are subject to what should be a generalized legislative act from the IURC.
“So not only is it contrary to the way the utility law is set up, it would be impractical,” Wendt said.
At closing, the justices stated they would first deal with the issue of whether to grant transfer in the case.
This article was first published by The Indiana Lawyer.