La Salle Townhouses Cooperative Ass'n v. Detroit Edison Co.

244 N.W.2d 343, 69 Mich. App. 7, 1976 Mich. App. LEXIS 716

• Court: Michigan Court of Appeals
• Decided: May 18, 1976
• Docket: Docket 23738
• Status: Published

Opinions

M. F. Cavanagh, J.

Plaintiffs are four cooperative associations, and various individual members of those associations, who use steam heat provided by defendant, The Detroit Edison Company. For a number of years, Edison has included in its steam rate computations an automatic fuel adjustment clause by which it passes on to all steam heat users any increases in the cost of fuel utilized to produce the steam. Plaintiffs brought suit in Wayne County Circuit Court challenging the fuel adjustment clause and seeking to recover the money paid pursuant to it.

Detroit Edison moved for accelerated judgment on the ground that the circuit court lacked subject matter jurisdiction. The trial judge granted the motion ruling that exclusive jurisdiction of the subject matter was in the Public Service Commission pursuant to MCLA 460.6; MSA 22.13(6). Alternatively, the trial judge ruled that even if the circuit courts have concurrent jurisdiction in such matters, under Valentine v Michigan Bell Telephone Co, 388 Mich 19; 199 NW2d 182 (1972), challenges to the validity of the MPSC rates themselves must first go to that commission. Plaintiffs now appeal that ruling.

Plaintiffs base their action on MCLA 460.6a; MSA 22.13(6a) which, prior to the 1972 amendment, prohibited the Public Service Commission from permitting the incorporation of fuel adjustment clauses in rate schedules for domestic service. Plaintiffs contend that they are domestic users. However, Detroit Edison has only two rates for steam heat; both are approved by the PSC; both contain fuel adjustment clauses.

As the trial judge noted, the basic issue is whether plaintiffs are "domestic” service within the meaning of MCLA 460.6a; MSA 22.13(6a). Plaintiffs do not challenge directly the validity of the PSC rates, but plaintiffs do argue that the rates do not apply to them. Plaintiffs challenge Detroit Edison’s application of the fuel adjustment clause to them. But the clause is part of the rate. Detroit Edison has no rate schedule for steam heat which does not include a fuel adjustment clause. The PSC has only authorized Detroit Edison to sell steam heat at rates which include a fuel adjustment. Thus, the question is whether the rates approved by the PSC apply to plaintiffs.

Since the approved rates include fuel adjustment clauses, we presume the rates are "commercial”. If plaintiffs are domestic service, not commercial, then they are entitled to a third "domestic” rate. Whether plaintiffs are entitled to a classification of "domestic service” and a third rate schedule without a fuel adjustment clause is — as the trial court noted — "particularly within the province of the commission’s specialized knowledge and expertise”. If the approved rates do not apply, then the PSC can find or require and approve a rate which would apply.

"There are some situations involving rates in which a customer may sue a utility in a court of general jurisdiction.” Valentine, supra, 388 Mich at 25.

But this is not one of those situations. Plaintiffs do not contend that they have suffered damage as a result of violations of tariffs and regulations. See Valentine v Michigan Bell Telephone Co, supra, at 30. Nor do plaintiffs contend that the two PSC rates are invalid. Basically, plaintiffs’ position is that the approved rates do not apply to them and that another rate, without a fuel adjustment clause, should apply.

"Ordinarily, a party aggrieved by the provisions of a tariff or code should seek relief by an attack upon those provisions before the Public Service Commission and from it to the Ingham County Circuit Court.” 388 Mich at 26.

The PSC should determine whether the approved rates apply to plaintiffs.

Affirmed.

Bashara, J., concurred.