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1.3.5 Dispute Resolution

Public utilities commissions typically have the power to decide individual customer disputes with utilities. The organic statutes often provide for the initiation of complaints against a utility before the commission.91 Often, however, the standing to bring such a complaint is not accorded to individual complainants.92 Rather, the statutes often will permit a complaint only if brought by persons or entities representing the general public interest, such as the attorney general, a municipal official, or a group consisting of a minimum number of customers. However, commissions usually have the power to open an investigation on their own motion, which provides authority to hear individual customer complaints. In some states (depending on each state’s utility statutes and interpreting case law) and under certain factual circumstances, courts have concurrent jurisdiction to consider matters affecting utility service, especially when the relief requested is equitable in nature.93 Courts may hold that they, and not the commission, have jurisdiction to award damages for wrongful acts committed by utilities.94

Statutes or commission rules frequently provide strict penalties for violation of commission rules. Customers who suffer damages may be able to simultaneously seek recovery of damages in court and also seek penalties before the commission. The penalty, sometimes substantial,95 would be paid to the state for violation of commission rules or state statutes. Any damages awarded by a court would, of course, go to the consumer.

The doctrine of primary jurisdiction may be invoked to bar judicial relief until a complainant exhausts any remedies available at the public utility commission.96 If a consumer seeks relief which cannot be granted by the commission but raises issues within the commission’s area of expertise, a court may stay proceedings while the commission makes a determination and then proceed to grant what relief is appropriate in light of the commission’s decision.97 A trial court will typically lack jurisdiction to review claims involving the rate-setting process, quality of service, or other matters under the commission’s express supervision.98

State administrative procedures acts may also contain provisions for officials or groups of affected persons to force an agency to undertake a rulemaking proceeding. In Maine, for example, while anyone might petition for the opening of a rulemaking process, upon a petition of 150 voters, an agency is required to hold a public hearing.99 The first winter disconnect moratorium in Maine was achieved after a commission rulemaking began in response to a petition with 700 signatures. Not only was a public hearing automatically required, but the number of signatories was a powerful signal of broad public interest in the outcome of the hearings.

Many commissions assist customers and utilities in resolving individual disputes by offering the services of staff members as mediators or nonbinding adjudicators. Staff are often located in a division called Consumer Assistance or something similar.100 In some cases, the process for invoking the assistance of such staff is set forth in rules promulgated by the commission pursuant to the state Administrative Procedures Act.101

Occasionally, issues concerning individual customer disputes are reported102 to or reach the courts on appeal from commission decisions, resulting in judicial determination of the applicable law. Many states require narrow routes for appeal of orders of the public service commission,103 and collateral attacks may be barred or discouraged by application of the doctrines of primary jurisdiction or exhaustion of administrative remedies discussed previously in this section. To foster the statutory purpose of a unified statewide utilities policy developed by an expert panel, appeals often lie to the supreme court rather than to trial or intermediate appellate courts. Because of the hurdles individual consumers must overcome to file appeals, courts rarely address the appropriateness of commission customer service policies.

Deregulation has affected these practices. Some commissions have looked at how the dispute resolution procedures will be utilized in a deregulated atmosphere.104 No clear mechanism has emerged, although the provider of last resort, usually the former monopoly utility, will still be subject to commission rules under most proposals. As to other electric service providers, the rules are not so clear.

Footnotes

  • 91 {91} See, e.g., Colo. Rev. Stat. § 40-6-108; Ohio Rev. Code Ann. § 4909.24 (West); Or. Rev. Stat. § 756.500.

  • 92 {92} But a state may allow individual suits against a utility to enforce the decisions of the commission or the statutes. For example, S.D. Codified Laws § 49-13-14.1 provides that individuals injured by wrongful acts or omissions of telephone companies may sue for double damages and be awarded attorney fees.

  • 93 {93} See, e.g., Steele v. Clinton Elec. Light & Power Co., 193 A. 613 (Conn. 1937) (fact that a PSC has jurisdiction to hear and determine disputes over charges for service does not deprive equity court of jurisdiction to enjoin the termination of service before payment of a disputed amount); Johnston v. Mid-Michigan Tel. Corp., 290 N.W.2d 146 (Mich. Ct. App. 1980) (court of general jurisdiction did not lack jurisdiction over claim in tort for alleged wrongful termination of service); Hall v. Vill. of Swanton, 35 A.2d 381 (Vt. 1944) (injunction will ordinarily be granted to prevent a utility company from wrongfully shutting off light, which such corporation is under contract to furnish, on the theory that the remedy at law is inadequate and that the shutting off of the supply would cause irreparable injury). But see State ex rel. Chesapeake & Potomac Tel. Co. v. Ashworth, 438 S.E.2d 890 (W. Va. 1993) (“Because of the complexity of the issues, we find that the circuit court should have deferred to the PSC.”).

    Courts frequently stay further court proceedings on complaints filed by customers when it appears that the utility commission can resolve complicated factual or legal issues within the expertise of the commission. See, e.g., Stark Steel v. Mich. Consol. Gas Co., 418 N.W.2d 135 (Mich. Ct. App. 1987) (discussing “primary jurisdiction” of utility commissions).

  • 94 {94} E.g., Lynn v. Houston Lighting & Power, 820 S.W.2d 57 (Tex. App. 1991) (court, not commission, has exclusive jurisdiction over tort damage claims for wrongful disconnection after meter tampering dispute); Stack Steel v. Mich. Consol. Gas Co., 418 N.W.2d 135 (Mich. Ct. App. 1987); City of Newton v. Dep’t of Pub. Utilities, 328 N.E.2d 885 (Mass. 1975).

  • 95 {95} See, e.g., Utah Code Ann. § 54-7-25 (West) (utility violation of any statute or commission rule subject to penalty of $500–$2000 for each offense; for continuing offenses, each day is a separate offense).

  • 96 {96} Northern Ind. Pub. Serv. Co. v. Dozier, 674 N.E.2d 977 (Ind. Ct. App. 1996) (Indiana Utility Regulatory Commission had primary jurisdiction to determine whether customer was unfairly denied gas service based on unpaid bill from former residence that was time-barred by statute of limitations); Whitinsville Water Co. v. Covich, 507 N.E.2d 1059, 1060 (Mass. App. Ct. 1987) (DPU may interpret disputed provisions of a tariff filed by the utility); Mass. Elec. Co. v. Doctors Hosp., 413 N.E.2d 779 (Mass. App. Ct. 1980) (staying customer’s suit, pending a report from the PUC as to the applicable rate); Rinaldo’s Constr. Corp. v. Mich. Bell Tel. Co., 559 N.W.2d 647 (Mich. 1997) (tort claims for money losses due to problems with telephone service must be brought before Michigan PSC; discussing primary jurisdiction). See also Travelers Ins. Co. v. Detroit Edison Co., 631 N.W.2d 733 (Mich. 2001) (primary jurisdiction doctrine is not jurisdictional but is not waived even if not timely pleaded by a party).

  • 97 {97} Penny v. Southwestern Bell, 906 F.2d 183 (5th Cir. 1990) (taking jurisdiction of UDAP claim because commission lacked power to award damages for past misconduct; staying proceedings so that commission could determine whether rate discrimination had occurred). See also Southwestern Bell Tel. v. Nash, 586 S.W.2d 647 (Tex. App. 1979).

  • 98 {98} Spence v. Boston Edison Co., 459 N.E.2d 80 (Mass. 1983) (rate determinations by the PUC are subject only to appellate review by the Supreme Judicial Court and cannot be challenged directly in courts by private parties); Valentine v. Mich. Bell Tel. Co., 199 N.W.2d 182 (Mich. 1972) (complaint for damages for inadequate service would not lie absent allegations of negligence, gross negligence, fraud, misrepresentation, or some other tort); State ex rel. Dayton Power & Light Co. v. Kistler, 385 N.E.2d 1076 (Ohio 1979) (claim of customer that utility discriminated between customers in setting rates). See also Stillman & Dolan v. Chesapeake & Potomac Tel. Co., 351 A.2d 172 (Md. 1976) (legislature established comprehensive utility regulatory scheme). But see, e.g., Lowell Gas Co. v. Att’y Gen., 385 N.E.2d 240, 245 (Mass. 1979) (trial court has jurisdiction over rate challenge to extent complaint alleges fraud in the rate-setting process).

  • 99 {99} Me. Rev. Stat. tit. 5, § 8055.

  • 100 {100} In some cases, staff from the legal division, the staff division charged with responsibility for the industry in question (for example, telecommunications), will handle individual customer complaints.

  • 101 {101} See, e.g., 220 Mass. Code Regs. § 25.02(4) (“investigation and appeal” of customer complaints). See appx. A.1, infra (summaries of most state customer service regulations).

  • 102 {102} See, e.g., Decision, Muhammad v. Southern Cal. Edison, 999 Cal. Pub. Util. Comm’n LEXIS 110, No. 99-02-026 (Cal. Pub. Utils. Comm’n 1999) (no violation of rules; dismissing customer complaint); Order, In re Complaint of Wood Against GTE Fla. Inc. Regarding Serv., 2000 Fla. Pub. Util. Comm’n LEXIS 905, PSC-00-1567-FOF-TL (Fla. Pub. Util. Comm’n 2000); Order, In re Complaint of Denson Against Fla. Power Corp. Regarding Improper Billing, 1999 Fla. Pub. Util. Comm’n LEXIS 1036, No. PSC 99-1226-PAA-EI (Fla. Pub. Util. Comm’n 1999) (over-billing charge dismissed).

  • 103 {103} E.g., Mass. Gen. Laws ch. 25, § 5; Ohio Rev. Code Ann. § 4903.12 (West). See also Or. Rev. Stat. §§ 756.580–756.610 (appeals first to circuit court, which must not substitute its judgment on the facts for that of commission; appeal thence to court of appeals).

  • 104 {104} For example, the Massachusetts Department of Telecommunications and Energy (now divided into the Department of Public Utilities and the Department of Telecommunications and Cable) produced the rules governing the restructuring of the electric industry, 220 Mass. Code Regs. §§ 11.01–11.08, which includes, inter alia, section 11.05(3) (“Billing and Termination of Generation Service”).