Public Service Indiana, Inc. v. Nichols

494 N.E.2d 349, 1986 Ind. App. LEXIS 2687, 1986 WL 1167056
CourtIndiana Court of Appeals
DecidedJune 26, 1986
Docket1-1283A409
StatusPublished
Cited by32 cases

This text of 494 N.E.2d 349 (Public Service Indiana, Inc. v. Nichols) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Public Service Indiana, Inc. v. Nichols, 494 N.E.2d 349, 1986 Ind. App. LEXIS 2687, 1986 WL 1167056 (Ind. Ct. App. 1986).

Opinion

YOUNG, Presiding Judge.

Public Service Indiana, Inc. appeals a jury verdict in favor of Melvin and Alice Nichols. On appeal, PSI contends that:

1) the Jackson Circuit Court improperly determined that it and not the Public Service Commission had subject matter jurisdiction over the action;
2) the doctrine of strict liability may not be applied against a utility company for injuries resulting from the sale of electricity;
3) the trial court erred in refusing to give a jury instruction based on Indiana "statutes;
4) the trial court erred in giving an instruction concerning the adequacy of PSI's services;
5) the trial court erred in allowing an expert witness to express opinions based on information collected and provided by an employee;
6) the trial court erred in allowing an expert witness to express an opinion as to the reasonableness of PSI's services.

We affirm.

In 1979, the Nichols decided to go into the dairy business and borrowed money to begin the operation. They built a barn and bought and installed the necessary equipment.

During this time period, PSI was engaged in the production, sale and distribution of electrical current. It owned the electrical lines running across the Nichols property and sold the electricity utilized by the Nichols in their dairy barn. PSI was aware that the Nichols intended to use the electricity in a dairy operation and had visited the Nichols farm to discuss their electrical needs while the dairy barn was still under construction.

The Nichols finished their barn and began milking in the fall of 1979. The Nichols soon noticed that the herd was not producing milk as it should. The dairy herd developed a high level of mastitis and showed signs of nervousness. By the fall of 1980, milk production had dropped severely. The Nichols investigated various potential causes for the problem throughout this time period. In January 1981, the Nichols' feed salesman suggested they check the farm for stray voltage since the problem was continuing, and the feed analysis had indicated that the herd was receiving the proper nutrients. The Nichols had their barn tested and discovered that stray voltage was coming from PSI's neutral line. The Nichols immediately contacted PSI.

PSI verified that stray voltage was present and attempted to solve the problem by separating the primary and secondary neutral lines. PSI neglected to tell the Nichols that this procedure created significant hazards such as the potential for electrocution or fire. Upon learning of these dangers through another source, the Nichols requested that the neutrals be reconnected and the problem solved in another fashion. Despite the knowledge that the stray voltage was coming from its neutral line and that the stray voltage was damaging the Nichols dairy herd, PSI never installed the equipment that would alleviate the problem, but rather took the position that it was not obligated or permitted to do so.

By October 1981, the Nichols dairy herd was ruined and the Nichols were forced to sell the entire herd. As a result of these events, the Nichols filed bankruptey in order to avoid a Sheriff's foreclosure sale. The Nichols brought this action against PSI seeking damages for the loss of the dairy herd and their business. The case *353 was tried to a jury on theories of negligence and strict liability. Punitive damages were sought but not awarded. The jury returned a general verdict for the Nichols in the amount of $848,000.00. Judgment was entered and PSI appeals on the previously listed grounds.

PSI argues that the trial court improperly determined that it had subject matter jurisdiction over this action and that the Nichols were obligated to pursue their claim through the Public Service Commission prior to seeking judicial resolution of the dispute. We disagree.

A trial court does not automatically acquire subject matter jurisdiction because it can provide a remedy that is not available through an administrative body. Indiana Forge and Machine Co., Inc. v. Northern Indiana Public Service Co. (1979), Ind.App., 396 N.E.2d 910, 912. The nature of the claim asserted determines the jurisdictional issue. If the legislature has provided that the administrative remedy is exclusive, the courts cannot exercise jurisdiction until the administrative remedies are exhausted. Id. at 912. However, this rule is not applied in a mechanical fashion. Exceptions to the rule have been created and include instances where pursuit of the administrative remedy would be futile, United States Auto Club, Inc. v. Woodward (1984), Ind.App., 460 N.E.2d 1255, 1258; Northside Sanitary Landfill, Inc. v. Indiana Environmental Management Board (1984), Ind.App., 458 N.E.2d 277, 280; Bowen v. Sonnenburg (1980), Ind.App., 411 N.E.2d 390, 403, where strict compliance would result in irreparable harm, South Bend Federation of Teachers v. National Education Association-South Bend (1979), 180 Ind.App. 299, 309, 389 N.E.2d 23, 30, or when no administrative remedy is provided. Indiana State Highway Commission v. Zehner (1977), 174 Ind.App. 176, 366 N.E.2d 697, 702.

In determining whether administrative remedies are available and should be exhausted, trial courts are to consider:

The character of the question presented and the competency of the administrative agency to answer that question; the avoidance of premature interruption of the administrative process in recognition of the interest of the agency in developing a factual record upon which to exercise its discretion and apply its expertise without the threat of litigious interference; the interest in permitting an agency to correct its own errors, a process by which unnecessary judicial proceedings are obviated; and the avoidance of deliberate or frequent flouting of established administrative processes.

Northside Sanitary Landfill, supra at 281 (quoting Indiana State Department of Welfare Medicaid Division v. Stagner (1980), Ind.App., 410 N.E.2d 1348, 1351).

The Public Service Commission was established "to insure that public utilities provide constant, reliable and efficient service to its customers, the citizens of this state." Office of Utility Consumer Counselor v. Public Service of Indiana, Inc. (1984), Ind.App., 463 N.E.2d 499, 508. The Commission derives its power and authority solely from statute and unless the power to act is conferred by the statute, it must be concluded that the power does not exist. Citizens Action Coalition of Indiana, Inc. v. Northern Indiana Public Service Co. (1985), Ind., 485 N.E.2d 610, 612.

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Bluebook (online)
494 N.E.2d 349, 1986 Ind. App. LEXIS 2687, 1986 WL 1167056, Counsel Stack Legal Research, https://law.counselstack.com/opinion/public-service-indiana-inc-v-nichols-indctapp-1986.