In re Complaint of Pilkington N. Am., Inc.

• Decision Date: 24 November 2015
• Docket Number: No. 2013–0709.,2013–0709.
• Citation: 145 Ohio St.3d 125,2015 Ohio 4797,47 N.E.3d 786
• Parties: In re Complaint of PILKINGTON NORTH AMERICA, INC., Appellant; Toledo Edison Company, Intervening Appellee; Public Utilities Commission, Appellee.
• Court: Ohio Supreme Court

145 Ohio St.3d 125

47 N.E.3d 786

2015 Ohio 4797

In re Complaint of PILKINGTON NORTH AMERICA, INC., Appellant; Toledo Edison Company, Intervening Appellee; Public Utilities Commission, Appellee.

No. 2013–0709.

Supreme Court of Ohio.

Submitted Sept. 2, 2015.

Decided Nov. 24, 2015.

Bricker & Eckler, L.L.P., Thomas J. O'Brien, J. Thomas Siwo, Matthew W. Warnock, and Daniel C. Gibson, Columbus, for appellant.

Michael DeWine, Attorney General, William L. Wright, Thomas G. Lindgren, and Thomas W. McNamee, Assistant Attorneys General, for appellee, Public Utilities Commission of Ohio.

Calfee, Halter & Griswold, L.L.P., James F. Lang, and Sarah M. Antonuccci, Cleveland; David S. Winston, for intervening appellee, Toledo Edison Company.

FRENCH, J.

{¶ 1} In the proceedings below, appellant, Pilkington North America, Inc., filed a motion for relief from judgment under Civ.R. 60(B). Pilkington sought relief from an order of appellee, the Public Utilities Commission, issued February 19, 2009, from which Pilkington did not appeal. The commission denied Pilkington's motion, finding that Pilkington did not meet the requirements of Civ.R. 60(B) and that, in any event, Pilkington was not entitled to relief because it may not use Civ.R. 60(B) as a substitute for appeal.

{¶ 2} Pilkington challenges the commission's order, raising two propositions of law, each containing several supporting arguments. Pilkington has waived its primary argument that the commission's February 19, 2009 order is ultra vires. The arguments that Pilkington did preserve lack merit. Therefore, we affirm the commission's order.

Facts and Procedural Background

{¶ 3} Pilkington is a large industrial company that manufactures glass. It has a facility in Rossford, Ohio. In 1990, Pilkington entered into a special contract with intervening appellee, Toledo Edison Company, under which the utility provided the Rossford facility with discounted electric service. The commission approved the special contract under R.C. 4905.31, which allows a public utility to enter into a "reasonable arrangement" with "one or more of its customers."

{¶ 4} In 2008, Pilkington filed a complaint under R.C. 4905.26, alleging that Toledo Edison had unlawfully terminated the special contract. See In re Complaint of Pilkington N. Am., Inc., Pub. Util. Comm. No. 08–255–EL–CSS, 7 (Feb. 19, 2009) (hereafter, the "2009 Order"). Five other large industrial companies, which also had special contracts with Toledo Edison, also filed complaints against the utility. The complaints were identical in that they alleged that Toledo Edison had prematurely terminated the special contracts in February 2008, despite contract language stating that the agreements would remain in effect until December 31, 2008. Id. at 2. The early termination meant that Pilkington and the other industrial customers would pay the tariff rates, which were higher than the contract rates, from February to the end of December 2008.

{¶ 5} The commission consolidated the six complaints, id. at 2, and the parties filed joint stipulations of fact. Id. at 3. Each of the industrial customers but one, Martin Marietta, agreed to pay into an escrow account the amounts in dispute, i.e., the difference between the special contract rates and the tariff rates from February 2008 to December 31, 2008. Id. at 7.

{¶ 6} On February 19, 2009, the commission dismissed the complaints. The commission found that the industrial customers failed to show that Toledo Edison "had violated any applicable order, statute, or regulation" when it terminated the special contracts in February 2008. 2009 Order at 20.

{¶ 7} Each of the industrial customers—except Pilkington—appealed the commission's decision to this court. Because Pilkington decided not to challenge the order on appeal, it had to release the money placed in escrow (which Pilkington claims was over $1.8 million) to Toledo Edison.

{¶ 8} In August 2011, we reversed the commission's order, holding that Toledo Edison had prematurely terminated the special contracts in February 2008. Martin Marietta Magnesia Specialties, L.L.C. v. Pub. Util. Comm., 129 Ohio St.3d 485, 2011-Ohio-4189, 954 N.E.2d 104. We found under the plain language of the contracts that the contracts should have remained in effect until December 31, 2008. Id. at ¶ 25. This meant that the industrial customers who had appealed were entitled to discounted rates from Toledo Edison over the ten-month billing period from February to December 31, 2008.

{¶ 9} Just over four months after we decided Martin Marietta, Pilkington filed a Civ.R. 60(B) motion for relief from judgment with the commission. Pilkington sought relief from the commission's February 19, 2009 order dismissing its complaint and the order denying the application for rehearing, which the other five complainants filed. Pilkington argued that this court's decision in Martin Marietta applied to Pilkington as it did to the other industrial customers who had successfully appealed the 2009 Order because its contract with Toledo Edison contained the same language as the other industrial customers' contracts. Therefore, according to Pilkington, it was entitled to the same remedy the other industrial customers received, namely, discounted rates through December 31, 2008.

{¶ 10} The commission denied Pilkington's motion, holding that Pilkington had failed to satisfy the requirements for obtaining relief under Civ.R. 60(B)(4). Pub. Util. Comm. No. 08–255–EL–CSS, 4 (Jan. 23, 2013). The commission also found that Pilkington was not entitled to relief under Civ.R. 60(B)(5) because that provision could not be used as a substitute for appeal. Id. at 5. According to the commission, Pilkington should have challenged the 2009 Order through an application for rehearing and an appeal to this court, as the other industrial customers had done. Id. at 4–5.

{¶ 11} Pilkington then filed an application for rehearing with the commission, claiming three errors. First, Pilkington claimed that the commission wrongly decided the Civ.R. 60(B) motion on procedural grounds rather than on the merits. Pilkington argued that the commission should exercise its authority under Ohio Adm.Code 4901–1–38(B) to waive the procedural requirements of Civ.R. 60(B) that Pilkington failed to follow.

{¶ 12} Second, Pilkington claimed that the commission violated the filed-rate doctrine by forcing it to pay an unauthorized rate. According to Pilkington, the lawful rate that applied to its electric service from Toledo Edison was the contract rate, as determined by our opinion in Martin Marietta.

{¶ 13} Third, Pilkington alleged that the commission allowed Toledo Edison to charge similarly situated customers different rates.

{¶ 14} The commission denied Pilkington's application for rehearing. Pub. Util. Comm. No. 08–255–EL–CSS, Entry on Rehearing, 5–6 (Mar. 20, 2013). Pilkington has now filed the instant appeal challenging the January 23 order and the order on rehearing.

Standard of Review

{¶ 15} " R.C. 4903.13 provides that a PUCO order shall be reversed, vacated, or modified by this court only when, upon consideration of the record, the court finds the order to be unlawful or unreasonable."

Constellation NewEnergy, Inc. v. Pub. Util. Comm., 104 Ohio St.3d 530, 2004-Ohio-6767, 820 N.E.2d 885, ¶ 50. We will not reverse or modify a commission decision as to questions of fact where the record contains sufficient probative evidence to show that the commission's decision was not manifestly against the weight of the evidence and was not so clearly unsupported by the record as to show misapprehension, mistake, or willful disregard of duty. Monongahela Power Co. v. Pub. Util. Comm., 104 Ohio St.3d 571, 2004-Ohio-6896, 820 N.E.2d 921, ¶ 29. The appellant bears the burden of demonstrating that the commission's decision is against the manifest weight of the evidence or is clearly unsupported by the record. Id.

{¶ 16} Although this court has "complete and independent power of review as to all questions of law" in appeals from the commission, Ohio Edison Co. v. Pub. Util. Comm., 78 Ohio St.3d 466, 469, 678 N.E.2d 922 (1997), we may rely on the expertise of a state agency in interpreting a law where "highly specialized issues" are involved and "where agency expertise would, therefore, be of assistance in discerning the presumed intent of our General Assembly." Consumers' Counsel v. Pub. Util. Comm., 58 Ohio St.2d 108, 110, 388 N.E.2d 1370 (1979).

Discussion

{¶ 17} Pilkington raises two propositions of law, each with various supporting arguments. After review of those arguments, we conclude that Pilkington has not demonstrated reversible error.

I. Proposition of Law No. 1: When an order of the commission is reversed on appeal, that order is ultra vires

{¶ 18} Pilkington's primary argument on appeal is that an order of the commission that is found to be unlawful is ultra vires and "of no legal effect." According to Pilkington, when this court reversed the 2009 Order in Martin Marietta, it rendered that order void as a matter of law not just with respect to the appealing parties, but even as to other customers of Toledo Edison that did not appeal the order and whose interests are so interwoven with those of the appealing parties as to justify relief. Therefore, Pilkington claims it is entitled to relief from the 2009 Order despite not challenging the order on appeal.

A. We lack jurisdiction over Pilkington's ultra vires claim

{¶ 19} Fatal to Pilkington's claim is its failure to raise the ultra vires argument in its application for rehearing of the commission's order denying Civ.R. 60(B) relief. R.C. 4903.10 requires a rehearing application to "set forth specifically the ground or grounds on which the applicant considers the order to be unreasonable or unlawful." Pilkington did not raise its ultra vires argument on rehearing as required by R.C. 4903.10, so we lack jurisdiction to consider it. See Consumers' Counsel v. Pub. Util. Comm., 70 Ohio St.3d 244, 247–248,...