Cleveland Elec. Illuminating Co. v. City of Cleveland
| Decision Date | 02 December 1976 |
| Citation | 363 N.E.2d 759,4 O.O.3d 247,50 Ohio App.2d 275 |
| Parties | , 4 O.O.3d 247 CLEVELAND ELECTRIC ILLUMINATING CO., Appellant, v. CITY OF CLEVELAND, Appellee. * CLEVELAND ELECTRIC ILLUMINATING CO., Appellee, v. CITY OF CLEVELAND, Appellant.* |
| Court | Ohio Court of Appeals |
Syllabus by the Court
1. Questions of exclusive federal jurisdiction and the ouster of jurisdiction of state courts are determined by the claims made by the suitor in his complaint. The plaintiff bringing the suit is free to decide what law he will rely upon (Pan American Petroleum v. Superior Court of Delaware (1961), 366 U.S. 656, 81 S.Ct. 1303, 6 L.Ed.2d 584 followed).
2. Where a plaintiff asserts a traditional common-law claim in an action brought in a state court, this claim does not lose that character solely because there exists a scheme of federal regulations of the subject matter of the suit.
3. Section 317 of the Federal Power Act, Section 825p, Title 16, U.S.Code, which provides that '(t)he District Courts of the United States * * * shall have exclusive jurisdiction of violations of (the Federal Power Act) or the rules, regulations, and orders thereunder, and of all suits in equity and actions at law brought to enforce any liability or duty created by, or to enjoin any violation of, this chapter or any rule, regulation, or order thereunder,' does not bar a plaintiff from pursuing at his option remedies based solely on state law in a state court for breach of a contract for the wholesale purchase of electric power.
4. The doctrine of primary administrative jurisdiction permits a court to avail itself of the expertise of an administrative agency having special competence in a matter before the court by suspending proceedings originally cognizable in the court pending resolution of such matter in the administrative agency.
5. The doctrine of primary administrative jurisdiction does not apply to a question which, while properly determinable by an administrative agency, does not involve matters within the special expertise of the agency, such as a matter of law.
6. The construction of sections of the Charter of the City of Cleveland and municipal ordinances enacted pursuant to authority provided therein are not within the special expertise of the Federal Power Commission.
7. The courts of Ohio are the ultimate arbiters of Ohio law and the duties and obligation thereunder.
8. A provision of the municipal charter, requiring a certificate from the director of finance of the City of Cleveland certifying that sufficient funds are available before a contract on behalf of such municipality is entered into, has not application where the director of public utilities enters into a contract for the purchase of electric power, the funds for such purchase being derived from operating revenues of the public utility and not from taxation (Paragraph 6 of the Syllabus of Burt v. City of Cleveland (1945), 76 Ohio App. 451, 62 N.E.2d 274, approved and followed).
9. An ordinance which is ambiguous must be interpreted in light of the circumstances under which it was enacted.
Bartunek, Bennett & Garofoli, Isaac Schulz and Donald H. Hauser, Cleveland, for the Cleveland Elec. Illuminating Co.
Vincent Campanella, Robert D. Hart and William B. Schatz, Cleveland, for the City of Cleveland.
The City of Cleveland (hereinafter designated 'City,' appellee in Case No. 34959 and appellant in Case No. 35002) operates the Municipal Electric Light Plant (hereinafter designated 'MELP') serving approximately twenty per cent (20%) of the retail load within the City of Cleveland. The remainder of that load is served by the Cleveland Electric Illuminating Company (hereinafter designated 'CEI,' appellant in Case No. 349-59, and appellee in Case No. 35002), a public utility under the Federal Power Act. 1
The facilities of MELP have been described as '* * * an isolated, poorly designed and relatively unreliable system * * * consisting of generating units in a 'sad state of repair' and a history of inefficient operations.' 2 Since 1942 there have been intermittent proposals for a permanent interconnection between CEL and MELP. The parties, however, failed to come to any agreement until after MELP experienced a severe power outage during Christmas, 1969.
Officials of CEI and the City met after the Christmas, 1969 outage and developed a basic understanding for the interconnection of the two systems. As a result of this understanding on January 19, 1970, the City Council enacted Ordinance 161-70 3 authorizing the director of public utilities to contract with CEI for the purchase of power. 4 The ordinance also specified the rates to be paid by the City for the purchase of such power.
Pursuant to the power granted him in Ordinance No. 161-70 the Director of Public Utilities, Ben F. Stefanski, II, entered into a contract with CEI for the wholesale purchase of electric power. The contract was contained in a letter from Lee C. Howley, vice president and general counsel of CEI, to Mr. Stefanski. The rates agreed to in this 'letter agreement' were filed with and approved by the Federal Power Commission (hereinafter designated 'FPC') 5 pursuant to the Federal Power Act. 6 The letter agreement and the FPC rate schedule were amended by the parties through subsequent letters three times. 7 During all these proceedings no objections were interposed by the City to the letter agreement or its filing under federal law. 8
The interconnection was initiated in February, 1970, and the record reveals that CEI performed all of the responsibilities required of it under the letter agreement. The City, however, increasingly fell behind in its payments to CEI, and on February 18, 1971, CEI filed suit against the City in the Common Pleas Court of Cuyahoga County, Ohio 9 (hereinafter the first action) .
While this suit was pending in Common Pleas Court, the City, fearing that CEI would terminate the interconnection for non-payment, filed a complaint with the FPC. 10 The complaint sought an order directing CEI not to disconnect from MELP, a determination of the rates due CEI for the power supplied since the initiation of the interconnection, 11 and an order directing CEI to maintain a permanent interconnection with MELP.
On March 10, 1972, the FPC ordered that as of May 17, 1972, CEI must maintain a temporary emergency interconnection with MELP, pending final determination of the City's complaint. Prior to this date CEI had voluntarily maintained the interconnection. 12 Interim rates for this temporary interconnection were set by another FPC order.
The FPC issued its final order resolving the City's complaint on January 11, 1973-Order 644. The FPC directed that a permanent interconnection be maintained between CEI and MELP and specified the rates which CEI could charge for this power. The order made these rates retroactive to May 17, 1972, the date the FPC first ordered CEI to maintain the interconnection. Included within the rates was a sanction for late payment by the City. The order also determined the rates prior to May 17, 1972.
In deciding the rates allowable prior to this date the FPC relied upon the filed rate doctrine 13 and determined that the rates were to be those contained in the letter agreement filed with the FPC. The commission ignored City Ordinance No. 161-70, stating that the effect of this ordinance was only a 'local matter between the City and its officials.' 14
The City filed a timely notice of appeal to the United States Court of Appeals for the District of Columbia Circuit, 15 pursuant to federal law. The City alleged that the commission erred first in dismissing the City Ordinance as only a matter of local concern in determining the rates prior to May 17, 1972; second, in that the permanent rates lacked substantial supporting evidence; third, in including an amount of Ohio excise tax in the makeup of the permanent rates; and fourth, in sanctioning a charge for late payment.
While the appeal was pending in the United States Court of Appeals, CEI filed a second action in the Common Pleas Court of Cuyahoga County, Ohio 16 (hereinafter designated the second action). The second action prayed the court for monies due since May 17, 1972, for the sale of electric power to the City by CEI.
The first and second actions were consolidated for trial and heard without a jury. The court entered its final judgments in both cases by entries dated June 4, 1975. In the first action the court found that the contract between the City and CEI contained in the letter agreement was valid and enforceable, and the City Charter provisions 17 alleged by the City as a defense were inapplicable to the controversy. The court awarded CEI damages of $547,115.33, and interest, for breach of the agreement.
In the second action the court dismissed the complaint for want of jurisdiction.
The City appealed from the judgment against it in the first action. CEI appealed from the dismissal of the second action. The cases were consolidated in this court.
There appears to be no dispute 18 that while these appeals were pending the FPC upon motion of CEI 19 issued an order dated April 8, 1974, which directed the City to comply with all previous orders of the FPC. 20 The FPC subsequently filed suit against the City in the United States District Court for the District of Columbia 21 pursuant to Section 825m(a), Title 16, U.S. Code, 22 praying that the City be enjoined from further violating the April 8, 1974 order. CEI was allowed to intervene as a new party plaintiff. 23
While this suit was pending in the District Court, the United States Court of Appeals for the District of Columbia Circuit ruled upon the City's appeal from FPC Order 644. In City of Cleveland v. F. P. C. (1976), 174 U.S.App.D.C. 1, 525 F.2d 845, the court affirmed the decision of the Commission in all aspects of its order save for its ruling on rates prior to May 17, 1972.
...
To continue reading
Request your trial
-
Sherr v. S.C. Elec. & Gas Co.
...6 L.Ed.2d 584 (1961) ; Engle v. West Penn Power Co., 366 Pa.Super. 104, 530 A.2d 913 (1987) ; Cleveland Elec. Illuminating Co. v. City of Cleveland, 50 Ohio App.2d 275, 363 N.E.2d 759 (1976). The court finds these cases distinguishable because they for obvious reasons could not apply the Gr......
-
Funderburk v. S.C. Elec. & Gas Co.
...6 L.Ed.2d 584 (1961) ; Engle v. West Penn Power Co., 366 Pa.Super. 104, 530 A.2d 913 (1987) ; Cleveland Elec. Illuminating Co. v. City of Cleveland, 50 Ohio App.2d 275, 363 N.E.2d 759 (1976). The court finds these cases distinguishable because they for obvious reasons could not apply the Gr......
-
City of E. Liverpool v. Buckeye Water Dist.
...may be spent on contractual obligations without prior certification of a fiscal officer. Cleveland Elec. Illuminating Co. v. City of Cleveland, 50 Ohio App.2d 275, 363 N.E.2d 759 (8th Dist.1976); Hines v. City of Bellefontaine, 74 Ohio App. 393, 57 N.E.2d 164 (3d Dist.1943). The public util......
-
Engle v. West Penn Power Co.
...Airco, Inc. v. Niagara Mohawk Power Corp., 65 A.D.2d 378, 411 N.Y.S.2d 460 (1978) and Cleveland Electric Illuminating Co. v. City of Cleveland, 50 Ohio App.2d 275, 363 N.E.2d 759 (1976), cert. denied, 434 U.S. 856, 98 S.Ct. 175, 54 L.Ed.2d 127 (1977). Both deal with, inter alia, the present......