State Ex Rel. Duke Energy Ohio, Inc. v. Hamilton County Court of Common Pleas , 126 Ohio St. 3d 41 ( 2010 )

[Cite as State ex rel. Duke Energy Ohio, Inc. v. Hamilton Cty. Court of Common Pleas, 126
Ohio St.3d 41, 2010-Ohio-2450.]
[THE STATE EX REL.] DUKE ENERGY OHIO, INC. v. HAMILTON COUNTY
COURT OF COMMON PLEAS ET AL.
[Cite as State ex rel. Duke Energy Ohio, Inc. v. Hamilton Cty. Court of
Common Pleas, 126 Ohio St.3d 41, 2010-Ohio-2450.]
Prohibition — Writ sought to prevent a common pleas court and one of its judges
from proceeding in a civil case arising from a public utility’s threatened
termination of service to a residential customer — Court and judge
patently and unambiguously lack jurisdiction to proceed because PUCO
has exclusive initial jurisdiction over rate- and service-related claims —
Peremptory writ granted.
(No. 2010-0416 — Submitted April 20, 2010 — Decided June 8, 2010.)
IN PROHIBITION.
__________________
Per Curiam.
{¶ 1} This is an original action for a writ of prohibition to prevent a
common pleas court and one of its judges from proceeding in a civil case arising
from a public utility’s charge for and threatened termination of service to a
residential customer. Because the court and judge patently and unambiguously
lack jurisdiction to proceed in the pending civil case because the Public Utilities
Commission of Ohio has exclusive initial jurisdiction over rate- and service-
related claims, we grant a peremptory writ of prohibition.
Facts
{¶ 2} Relator, Duke Energy Ohio, Inc. (“Duke Energy”), is a public-
utility corporation that supplies gas and electricity to customers throughout
southwestern Ohio. Duke Energy is a wholly owned subsidiary of Duke Energy
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Corporation, which is not a public utility. Proposals, L.L.C. (“Proposals”) is a
limited-liability company that invests in real estate.
{¶ 3} Duke Energy provides gas and electricity to two separate parcels of
real estate owned by Proposals – 832 Oak Street, in Cincinnati, Ohio, and 609
18th Street, in Middletown, Ohio. Proposals rented the upstairs and downstairs
units at its Cincinnati property, under terms that required each tenant to pay the
gas and electric bills for the area they used, including the basement. Duke Energy
inspected the property and informed Proposals that certain lighting fixtures
needed to be rewired. After Proposals finished the rewiring, Duke Energy
credited the tenants with over $9,000 previously charged to them and billed
Proposals for this amount. Duke Energy billed some of this amount to Proposals’
Middletown property and notified Proposals that it would disconnect utility
service if the amount was not paid by February 26, 2010.
{¶ 4} On February 19, 2010, Proposals filed a complaint in respondent
Hamilton County Court of Common Pleas against Duke Energy’s parent
corporation. In addition to filing the complaint, Proposals filed a motion for a
temporary restraining order and preliminary injunction to prevent the parent
corporation “from cutting off utility service at 609 18th Street in Middletown,
Ohio, until such time as the Court shall have a full opportunity to rule on the
merits.” In its motion, Proposals argued that Duke Energy’s actions violated R.C.
4933.122(B). The parent corporation opposed the motion and moved to dismiss
the civil action on the basis that the court lacked jurisdiction over the service-
related complaint. On February 23, respondent Judge Norbert A. Nadel of the
common pleas court granted Proposals’ motion and issued an order restraining the
parent corporation from cutting off utility service at Proposals’ property. Judge
Nadel scheduled a March 10 hearing on Proposals’ request for a preliminary
injunction.
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{¶ 5} On February 26, 2010, Proposals filed a complaint with the Public
Utilities Commission of Ohio based on the identical facts and claims in its civil
action. More specifically, Proposals described its commission complaint against
Duke Energy as follows:
{¶ 6} “The property in question is a 130 year old duplex with two gas
and two electric meters. Proposals, LLC purchased the property in Sep ’07 and
leases to two tenants. Duke Energy did an inspection July ’09 after one tenant
had their gas and electric disconnected for lack of payment. They verbally
informed us that the basement was considered a common area and the lights
therein had to be either on a separate meter or separately switched from within the
tenants apartments. We rewired the single basement light switch into two. Duke
re-inspected and stated they were satisfied but were going to bill us back all gas
and electric since the tenants moved in totaling $9047.73 and refund same to the
tenants. We called PUCO and were told Duke was in error since such master
metering only applied to commercial properties[.] Duke has refused to give us
any inspection reports or further billing for 6 months and we have retained an
attorney for discovery. Duke is now threatening disconnection.”
{¶ 7} The parent corporation renewed its motion to dismiss the civil case
and advised Judge Nadel of Proposals’ pending complaint before the commission.
Judge Nadel refused to dismiss the case and instructed the parties that the
preliminary-injunction hearing would go forward as scheduled. Judge Nadel also
allowed Proposals to amend its complaint to add Duke Energy as an additional
defendant.
{¶ 8} In its amended complaint, Proposals claimed that Duke Energy and
its parent corporation unlawfully charged it $9,047.73 for the provision of gas and
electricity to its Cincinnati property and illegally threatened to terminate utility
service for its Middletown property in violation of R.C. 4933.122(B). Proposals
requested (1) an injunction preventing Duke Energy and its parent corporation
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from cutting off service to any of its properties in order to collect the disputed
charge, (2) a declaratory judgment that it does not owe Duke Energy and its
parent corporation the $9,047.73 claimed, (3) a declaratory judgment that neither
Duke Energy nor its parent corporation is authorized to interfere with its
constitutionally protected contractual relationships, and (4) an award for its
damages and attorney fees.
{¶ 9} Duke Energy filed this action for a writ of prohibition to prevent
the common pleas court and Judge Nadel from exercising jurisdiction over the
civil case and from restraining Duke Energy from disconnecting utility services
because certain services provided by Duke Energy had not been paid for by
Proposals. The common pleas court and Judge Nadel filed a motion to dismiss.
Duke Energy filed a memorandum in opposition. In addition, William Flax, the
attorney for Proposals, filed a motion for leave to file an amicus curiae
memorandum in support of respondents.
{¶ 10} This cause is now before the court for our S.Ct.Prac.R. 10.5
determination.
Legal Analysis
Motion for Leave to File Amicus Curiae Memorandum
{¶ 11} The attorney for Proposals seeks leave to file an amicus curiae
memorandum in support of the common pleas court and Judge Nadel. Under
S.Ct.Prac.R. 10.8 and 6.6, an amicus curiae may file a merit brief in an original
action without leave of court. See State ex rel. Citizen Action for a Livable
Montgomery v. Hamilton Cty. Bd. of Elections, 115 Ohio St.3d 437, 2007-Ohio-
5379, 875 N.E.2d 902, ¶ 24. But the Supreme Court Rules of Practice do not
specifically authorize amici curiae to file memoranda before an alternative writ is
granted, so leave must be sought. See State ex rel. Vaughn Industries, L.L.C. v.
Reece, 116 Ohio St.3d 1212, 2007-Ohio-6670, 878 N.E.2d 1050, ¶ 3 (granting
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motion of amicus curiae for leave to file a memorandum opposing respondents’
motion to dismiss in prohibition case).
{¶ 12} We grant Proposals’ motion for leave to file the memorandum
because it is the plaintiff in the underlying action that Duke Energy seeks to
prevent, and the memorandum will assist us in our S.Ct.Prac.R. 10.5
determination.
S.Ct.Prac.R. 10.5 Standard
{¶ 13} We must determine whether dismissal, an alternative writ, or a
peremptory writ is appropriate. S.Ct.Prac.R. 10.5. Dismissal, which the common
pleas court and Judge Nadel request in their motion, is required if it appears
beyond doubt, after presuming the truth of all material factual allegations of Duke
Energy’s complaint and making all reasonable inferences in its favor, that Duke
Energy is not entitled to the requested extraordinary relief in prohibition. State ex
rel. Finkbeiner v. Lucas Cty. Bd. of Elections, 122 Ohio St.3d 462, 2009-Ohio-
3657, 912 N.E.2d 573, ¶ 10.
{¶ 14} If, however, after so construing the complaint, it appears that its
prohibition claim may have merit, we will grant an alternative writ and issue a
schedule for the presentation of evidence and briefs. State ex rel. Mason v.
Burnside, 117 Ohio St.3d 1, 2007-Ohio-6754, 881 N.E.2d 224, ¶ 8.
{¶ 15} Finally, if the pertinent facts are uncontroverted and it appears
beyond doubt that Duke Energy is entitled to the requested extraordinary relief in
prohibition, a peremptory writ will be granted. State ex rel. Sapp v. Franklin Cty.
Court of Appeals, 118 Ohio St.3d 368, 2008-Ohio-2637, 889 N.E.2d 500, ¶ 14.
Prohibition Claim
{¶ 16} To be entitled to the requested writ of prohibition, Duke Energy
must establish that (1) Judge Nadel and the common pleas court are about to
exercise judicial power, (2) the exercise of that power is unauthorized by law, and
(3) denying the writ would result in injury for which no other adequate remedy
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exists in the ordinary course of law. State ex rel. Cordray v. Marshall, 123 Ohio
St.3d 229, 2009-Ohio-4986, 915 N.E.2d 633, ¶ 25. Judge Nadel and the common
pleas court are exercising judicial power in the underlying civil case.
{¶ 17} For the remaining requirements, “[i]f a lower court patently and
unambiguously lacks jurisdiction to proceed in a cause, prohibition * * * will
issue to prevent any future unauthorized exercise of jurisdiction and to correct the
results of prior jurisdictionally unauthorized actions.” State ex rel. Mayer v.
Henson, 97 Ohio St.3d 276, 2002-Ohio-6323, 779 N.E.2d 223, ¶ 12. “Where
jurisdiction is patently and unambiguously lacking, [a relator] need not establish
the lack of an adequate remedy at law because the availability of alternate
remedies like appeal would be immaterial.” Sapp, 118 Ohio St.3d 368, 2008-
Ohio-2637, 889 N.E.2d 500, at ¶ 15. Therefore, the dispositive issue is whether
Judge Nadel and the common pleas court patently and unambiguously lack
jurisdiction to proceed in the underlying civil claims against Duke Energy.
Rate- and Service-Related Public-Utility Complaints
{¶ 18} “The General Assembly has created a broad and comprehensive
statutory scheme for regulating the business activities of public utilities. R.C.
Title 49 sets forth a detailed statutory framework for the regulation of utility
service and the fixation of rates charged by public utilities to their customers. As
part of that scheme, the legislature created the Public Utilities Commission and
empowered it with broad authority to administer and enforce the provisions of
Title 49.” Kazmaier Supermarket, Inc. v. Toledo Edison Co. (1991), 61 Ohio
St.3d 147, 150, 573 N.E.2d 655.
{¶ 19} R.C. 4905.22 specifies that “[e]very public utility shall furnish
necessary and adequate service” and that charges for public utility services must
be “just, reasonable, and not more than the charges allowed by law or by order of
the public utilities commission.” R.C. 4905.26 confers exclusive jurisdiction on
the commission to determine whether any charge or service rendered by a public
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utility “is in any respect unjust, unreasonable, * * * or in violation of law.” See
also State ex rel. Illum. Co. v. Cuyahoga Cty. Court of Common Pleas, 97 Ohio
St.3d 69, 2002-Ohio-5312, 776 N.E.2d 92, ¶ 18; State ex rel. Columbia Gas of
Ohio, Inc. v. Henson, 102 Ohio St.3d 349, 2004-Ohio-3208, 810 N.E.2d 953, ¶
16.
{¶ 20} Therefore, a “Court of Common Pleas is without jurisdiction to
hear a claim alleging that a utility has violated R.C. 4905.22 by charging an unjust
and unreasonable rate and wrongfully terminating service, since such matters are
within the exclusive jurisdiction of the Public Utilities Commission.” Milligan v.
Ohio Bell Tel. Co. (1978), 56 Ohio St.2d 191, 10 O.O.3d 352, 383 N.E.2d 575,
paragraph two of the syllabus.
{¶ 21} To determine whether the commission has exclusive jurisdiction
over the underlying case, we must determine (1) whether the commission’s
administrative expertise is required to resolve the disputed issue and (2) whether
the act complained of constitutes a practice normally authorized by the utility.
Corrigan v. Illum. Co., 122 Ohio St.3d 265, 2009-Ohio-2524, 910 N.E.2d 1009, ¶
11. If either requirement is not met, “the claim is not within PUCO’s exclusive
jurisdiction.” Allstate Ins. Co. v. Cleveland Elec. Illum. Co., 119 Ohio St.3d 301,
2008-Ohio-3917, 893 N.E.2d 824, ¶ 13.
{¶ 22} First, the commission’s administrative expertise is required to
resolve this dispute. Proposals’ claims in the civil action involve Duke Energy’s
charge of $9,047.73 to it for the provision of gas and electricity to its Cincinnati
property and the threatened termination of service at Proposals’ Middletown
property if the disputed charge is not paid. These claims are manifestly rate- and
service-related complaints, which are within the exclusive jurisdiction of the
commission. Henson, 102 Ohio St.3d 349, 2004-Ohio-3208, 810 N.E.2d 953;
Illum. Co., 97 Ohio St.3d 69, 2002-Ohio-5312, 776 N.E.2d 92; and Milligan, 56
Ohio St.2d 191, 10 O.O.3d 352, 383 N.E.2d 575. In fact, in its amended
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complaint in the common pleas court, Proposals alleges that Duke Energy
violated R.C. 4933.122, which specifies the procedures for public utilities to
terminate service. Cf., e.g., Henson, ¶ 23 (alleged violations of R.C. 4933.12 are
within the exclusive jurisdiction of the commission).
{¶ 23} Second, the acts complained of – Duke Energy’s threatened
disconnection of utility service to Proposals’ property and the charge of $9,047.73
to Proposals for utility service previously provided to its tenants – constitute
practices normally authorized by the utility, i.e., the termination of utility service
for nonpayment. Ohio Adm.Code 4901:1-18-07 specifies the procedures for a
utility company to “disconnect utility service of individuals whose utility services
are included in rental payments and of consumers residing in a multi-unit
dwelling (i.e., tenants who receive master-metered services) for which the
customer is the landlord.”
{¶ 24} Based on the foregoing, although some of Proposals’ claims in the
civil action are couched in terms of tort and contract, they are insufficient to
confer jurisdiction on the common pleas court because it is manifest that these
claims are based upon violations of public-utility laws, which are within the
exclusive initial jurisdiction of the commission to determine. Henson.
Conclusion
{¶ 25} Therefore, because the pertinent facts are uncontroverted and it
appears beyond doubt that Duke Energy is entitled to the requested extraordinary
relief, we grant a peremptory writ of prohibition to prevent the common pleas
court and Judge Nadel from proceeding in the civil action on the claims against
Duke Energy.
Writ granted.
LUNDBERG STRATTON, O’CONNOR, O’DONNELL, LANZINGER, and CUPP,
JJ., concur.
PFEIFER, J., dissents and would dismiss the cause.
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BROWN, C.J., not participating.
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Eberly McMahon, L.L.C., and Robert A. McMahon, for relator.
Joseph T. Deters, Hamilton County Prosecuting Attorney, and Christian J.
Schaefer and Charles W. Anness, Assistant Prosecuting Attorneys, for
respondents.
William Flax, urging denial of the writ for amicus curiae, Proposals,
L.L.C.
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