Lauer v. New York Telephone Co.

• Citation: 231 A.D.2d 126,659 N.Y.S.2d 359
• Decision Date: 03 July 1997
• Docket Number: No. 1,NYNEX-N,No. 2,1,2
• Parties: Andrew LAUER, on Behalf of Himself and All Others Similarly Situated, Respondent, v. NEW YORK TELEPHONE COMPANY, Doing Business asew York, Appellant. (Action) Daniel FORREST et al., on Behalf of Themselves and All Others Similarly Situated, Respondents, v. NEW YORK TELEPHONE COMPANY, a Wholly Owned Subsidiary of NYNEX Corporation, Appellant. (Action)
• Court: New York Supreme Court Appellate Division

Page 359

659 N.Y.S.2d 359

231 A.D.2d 126

Andrew LAUER, on Behalf of Himself and All Others Similarly

Situated, Respondent, v. NEW YORK TELEPHONE COMPANY, Doing Business as NYNEX-New

York, Appellant. (Action No. 1.)

Daniel FORREST et al., on Behalf of Themselves and All

Others Similarly Situated, Respondents, v. NEW YORK TELEPHONE COMPANY, a Wholly Owned Subsidiary of

NYNEX Corporation, Appellant. (Action No. 2.)

Supreme Court, Appellate Division Third Department.

July 3, 1997.

Davis, Polk & Wardwell (Guy Miller Struve, of counsel), and John E. Reilly, New York Telephone Company, New York City, for appellant.

Zwerling, Schachter & Zwerling LLP, Goodkind, Labaton, Rudoff & Sucharow LLP and Heller, Horowitz & Feit P.C., New York City, Kenneth J. Munnelly, Delmar, and Meyer, Suozzi, English & Klein (G. Oliver Koppell, of counsel), Mineola, for respondents.

Before MIKOLL, J.P., and MERCURE, CREW, WHITE and PETERS, JJ.

PETERS, Justice.

Appeals (1) from an order of the Supreme Court (Keegan, J.), entered March 19, 1996 in Albany County, which, inter alia, denied defendant's motion to dismiss the complaint in action No. 1 and defendant's cross motion to dismiss the amended complaint in action No. 2 for failure to state a cause of action, (2) from an order of said court, entered September 24, 1996 in Albany County, which denied defendant's motion for reconsideration, and (3) from an order of said court, entered December 9, 1996 in Albany County, which granted plaintiffs' motions in action Nos. 1 and 2 for class action certification.

Defendant, a public utility subject to the jurisdiction, supervision and powers of the Public Service Commission (hereinafter PSC), sought to offer a service to its customers, pursuant to its filed tariffs, known as "Call ID". This service, which entails the use of a separate screen to display the telephone number from which a call originates, initially left unrestricted the display of those numbers of nonpublished and nonlisted service users. Before permitting defendant to offer such service, the PSC required that defendant offer its customers a service called "All Call Restrict" as part of their basic and nonpublished telephone number service. This service "[p]revents delivery of the calling number to a Call ID subscriber on all calls made from a particular line, unless the feature is disabled". Defendant ultimately offered such service yet, pursuant to its filed tariff, placed the burden upon customers to specifically request the All Call Restrict option. The tariff provided an express limitation of liability with respect to this service:

[Defendant] will not be liable for any economic harm, personal injury, invasion of any right of privacy of any person, or any other harm, loss or injury, caused or claimed to be caused, directly or indirectly, by [defendant's] delivery or failure to deliver the telephone number of a calling party. Additional limitations of liability provisions are contained in Section 1 of this Tariff.

The additional limitation of liability provision referred to therein was a general limitation of liability provision which applied "in the absence of gross negligence or willful misconduct".

Plaintiff Andrew Lauer commenced an action in February 1995 seeking to represent a class of persons who ordered, but failed to receive, All Call Restrict (hereinafter action No. 1). Plaintiffs Daniel Forrest and Yvonne Sleurs filed a class action complaint, later amended and adding Adrian Clarke as a plaintiff (hereinafter action No. 2), to certify three classes of persons who did not receive All Call Restrict. ¹ These plaintiffs moved for class certification in May 1995, prompting defendant to file a cross motion to dismiss the amended complaint pursuant to, inter alia, the filed-tariff doctrine and the doctrine of primary jurisdiction. Defendant filed a motion to dismiss the complaint in action No. 1 on the same grounds.

By stipulation and order the actions were consolidated and, in March 1996, Supreme Court denied all motions to dismiss. Defendant appealed and later unsuccessfully sought reconsideration. In a third order entered December 9, 1996, Supreme Court granted the motions for class certification. All orders were appealed by defendant.

We initially note that Supreme Court, in determining the motions to dismiss, properly considered whether the filed-tariff and primary jurisdiction doctrines precluded the causes of action propounded by plaintiffs (see, Minihane v. Weissman, 226 A.D.2d 152, 640 N.Y.S.2d 102; Bell v. Village of Cornwall, 25 A.D.2d 561, 267 N.Y.S.2d 1021). As to its failure to dismiss these actions upon the filed-tariff doctrine, we find no error. Recognizing that liability and rate making are inextricably intertwined, therefore making it permissible for a utility to limit its liability (see, Western Union Tel. Co. v. Esteve Bros. & Co., 256 U.S. 566, 571, 41 S.Ct. 584, 586, 65 L.Ed. 1094), once the tariff is accepted by the PSC, it "takes on the force and effect of law and governs every aspect of the utility's rates and practices; neither party can depart from the measure of compensation or standard of liability contained therein" (Lee v. Consolidated Edison Co. of N.Y., 98 Misc.2d 304, 305-306, 413 N.Y.S.2d 826; see, Public Service Law § 66 [12] ). In considering the provisions of the tariff as "part of the contract between the customer and the utility" (Krasner v. New York State Elec. & Gas Corp., 90 A.D.2d 921, 921-922, 457 N.Y.S.2d 927), with all ambiguities strictly construed against the drafter (see, Maro Leather Co. v. Aerolineas Argentinas, 142 A.D.2d 265, 270, 535 N.Y.S.2d 982, appeal dismissed 85 N.Y.2d 837, 624 N.Y.S.2d 365, 648 N.E.2d 784, cert. denied 514 U.S. 1108, 115 S.Ct. 1958, 131 L.Ed.2d 850; Krasner v. New York State Elec. & Gas Corp., supra ), we find that the language of these provisions, when read together, did not preclude plaintiffs' causes of action specifically alleging willful misconduct and gross negligence.

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