Teleco, Inc. v. Southwestern Bell Telephone Co.

• Citation: 392 F. Supp. 692
• Decision Date: 07 February 1974
• Docket Number: Civ. No. 73-204-D.
• Parties: TELECO, INC., a corporation, Plaintiff, v. SOUTHWESTERN BELL TELEPHONE COMPANY, a corporation, Defendant.
• Court: U.S. District Court — Western District of Oklahoma

392 F. Supp. 692

TELECO, INC., a corporation, Plaintiff, v. SOUTHWESTERN BELL TELEPHONE COMPANY, a corporation, Defendant.

Civ. No. 73-204-D.

United States District Court, W. D. Oklahoma.

February 7, 1974.

COPYRIGHT MATERIAL OMITTED

Collier Pate, Oklahoma City, Okl., for plaintiff.

Robert D. Allen, Oklahoma City, Okl., for defendant.

MEMORANDUM OPINION

DAUGHERTY, Chief Judge.

Defendant is a supplier of telephone service to the public in Oklahoma under tariffs filed with the Oklahoma Corporation Commission. Article 9, Sections 34 and 18, Oklahoma State Constitution. Plaintiff was and is one of its customers. Plaintiff connected some of its privately owned telephone equipment to the Defendant's telephone facilities by "direct electrical connection" or what is sometimes called to "hard wire" directly into Defendant's telephone system. Defendant advised Plaintiff that such connection violated its tariffs¹ filed with the Oklahoma Corporation Commission in that under the same such a connection could only be accomplished by use of a Defendant — installed "coupler" or connecting arrangement or device (STC) with monthly charges for the same to be paid by Plaintiff.² Defendant requested that Plaintiff cease such violation. Plaintiff refused. Defendant then delivered written notice to Plaintiff that its telephone service would be interrupted and suspended unless Plaintiff ceased its violation of Defendant's filed tariff within ten days.³ Plaintiff refused and after such period of time expired Defendant interrupted and suspended telephone service to Plaintiff. Such interruption of service continued for approximately five days. The parties reached an agreement in writing whereupon the telephone service was restored and continues today.⁴

The Plaintiff brought two State Court actions against the Defendant, the first for an alleged breach of contract by Defendant and the second for an alleged conversion of Plaintiff's own telephone equipment by Defendant, both actions being based on Defendant's said interruption and suspension of telephone service to Plaintiff. In these actions the only relief sought by Plaintiff is the recovery of actual and punitive monetary damages. These two State Court actions have been removed by Defendant to this Court in one Petition for Removal. They were given the captioned number. The Court has ordered the two removed State Court petitions consolidated for disposition in this Court. Rule 42(a), Federal Rules of Civil Procedure.

To Plaintiff's claims the Defendant denies it breached a contract with Plaintiff or converted Plaintiff's telephone equipment, asserting that Plaintiff violated the aforementioned tariffs filed with the Oklahoma Corporation Commission and therefore its contract with Defendant and upon such violation Defendant had both the right and duty to interrupt Plaintiff's telephone service after Plaintiff refused to desist in such tariff violations after written notice.

In the above posture, the Court has under consideration Defendant's Motion For Summary Judgment on Plaintiff's claims for breach of contract and conversion which Motion is supported by several documents. Plaintiff opposes the Motion. Both parties have filed Briefs to the Motion and the Court has heard oral arguments on the same.

Tariffs filed with the Oklahoma Corporation Commission "are the law". Shehi v. Southwestern Bell Telephone Company, 382 F.2d 627 (Tenth Cir. 1967). See Note 1, supra. Also see Palermo v. Bell Telephone Company of Pennsylvania, 415 F.2d 298 (Third Cir. 1969); Carrigan v. Sunland-Tujunga Telephone Company, 263 F.2d 568 (Ninth Cir. 1959) cert. den. 359 U.S. 975, 79 S.Ct. 893, 3 L.Ed.2d 841; Western Union Telegraph Company v. Esteve Bros. & Co., 256 U.S. 566, 41 S.Ct. 584, 65 L.Ed. 1094 (1921); Carter v. American Telephone & Telegraph Company, 365 F.2d 486 (Fifth Cir. 1966) cert. den. 385 U.S. 1008, 87 S.Ct. 714, 17 L.Ed.2d 546 (1967). In the Carter case the Court said:

". . . a tariff required by law to be filed is not a mere contract. It is the law."

The regulation of telephone service in Oklahoma falls within the police power of the state. Blakeley v. Corporation Commisision, 332 P.2d 1103 (Okl.1958). A regulated telephone company has the duty under Oklahoma law to serve the public without discrimination. Hixon v. Snug Harbor Water & Gas Co., 381 P.2d 308 (Okl.1963). The right to telephone service is not an inherent right but a right to be exercised under the police power of the state and may be limited by conditions of tariffs. Smith v. Southern Bell Tel. Co., 268 Ky. 421, 104 S.W.2d 961 (1937); Wilkinson v. New England Tel. & Tel. Co., 327 Mass. 132, 97 N.E.2d 413 (1951); Palma v. Powers, 295 F.Supp. 924 (N.D.Ill.1969).

Thus, the pertinent tariffs (as the law) became a part of any contract between Plaintiff and Defendant with reference to Plaintiff's telephone service⁵ and as Plaintiff has admitted a tariff violation by its "direct electrical connection"⁶ and admits receipt of notice from Defendant of such claimed "hard wire" tariff violation and of Defendant's intention to suspend Plaintiff's telephone service for such violation unless the violation was discontinued, which notice the Court deems to be reasonable as a matter of law, and as a further tariff filed with the Oklahoma Corporation Commission provides that the Defendant may discontinue service to a customer who violates a tariff, Plaintiff's claim that Defendant breached a contract between them by enforcing the tariff and interrupting Plaintiff's telephone service upon Plaintiff's refusal to desist in a tariff violation is without merit as a matter of law. To the contrary, it is conclusively shown that Plaintiff violated the contract between the parties regarding telephone service.

Plaintiff's next claim that Defendant has converted its privately owned telephone equipment by the interruption of telephone service to the Plaintiff is without legal foundation. There is no claim made by Plaintiff that Defendant has physically taken possession of Plaintiff's privately owned telephone equipment. "Conversion" is any distinct act of dominion wrongfully exerted over personalty of another in denial of or inconsistent with his rights therein. Benton v. Ortenberger, 371 P.2d 715 (Okl.1962). As stated above the right to telephone service is not an inherent right but a right to be exercised under the police power of the state and may be limited by tariffs. The right to telephone service is not personalty or personal property which is capable of being converted, the right is not a vested right but in reality a privilege. United States Light & Heat Corp. v. Niagara Falls Gas & E. L. Co., 47 F.2d 567 (Second Cir. 1931) cert. den. 283 U.S. 864, 51 S.Ct. 656, 75 L.Ed. 1469; Midland Realty Co. v. Kansas City Power & Light Co., 300 U.S. 109, 57 S.Ct. 345, 81 L.Ed. 540 (1936). The Court therefore concludes under the undisputed facts before the Court that Defendant did not take possession of or commit an act of dominion over Plaintiff's telephone equipment by interrupting its service to Plaintiff and convert the same to its own use. But, if it could be said that Defendant committed an act of dominion over Plaintiff's telephone equipment by interrupting its telephone service to Plaintiff it was not a wrongful domination in denial of Plaintiff's rights in said equipment as shown elsewhere herein. Any such domination would have been lawful, not wrongful, because Plaintiff violated a tariff and Defendant thereupon had the right and duty to interrupt service after notice. Moreover, Plaintiff was attempting to use its own telephone equipment in excess of its rights to use the same in connection with Defendant's regulated telephone facilities.

Thus, Plaintiff's conversion claim is without legal basis and must fail. No factual disputes are involved regarding this claim and it must fail as a matter of law.

In its Briefs filed herein in connection with Defendant's Motion For Summary Judgment, the Plaintiff has raised several legal issues which though not plead will nonetheless be considered by the Court. Plaintiff's claim of estoppel and/or waiver on the basis that Defendant had lengthy prior notice of Plaintiff's "direct electrical connection" to its facilities and by doing nothing over a considerable period of time became estopped to interrupt Plaintiff's telephone service and/or waived the application of its tariffs in this respect as to Plaintiff is without legal merit as a matter of law under the undisputed facts of the situation at bar. These familiar legal doctrines might apply in a controversy between private individuals. However, they do not apply in a situation involving the enforcement of tariffs filed with the Oklahoma Corporation Commission in its supervision, regulation and control of telephone companies doing business in Oklahoma. Shehi v. Southwestern Bell Telephone Company, supra; Atchison, Topeka and Santa Fe Ry. Co. v. John Sexton & Co., 339 F.Supp. 1202 (D.Kan.1972); Western Union Telegraph Company v. Woods, 266 S.W. 179 (Tex.Civ.App.1924); Building Industries Exhibit, Inc. v. Public Utilities Commission, 150 Ohio St. 251, 80 N.E.2d 836 (1948); Coosa Valley Telephone Company v. Martin, 272 Ala. 383, 133 So.2d 505 (1961); Komatz Construction, Inc. v. Western Union Telegraph Company, 290 Minn. 129, 186 N.W.2d 691 (1971) cert. den. 404 U.S. 856, 92 S.Ct. 102, 30 L.Ed.2d 98 (1971); Kerns v. Western Union Telegraph Company, 198 S.W. 1132 (Mo.App.1917); Williams v. Western Union Telegraph Company, 218 Mo.App. 364, 275 S.W. 570 (1925); Western Union Telegraph Company v. Guitar, 116 Tex. 497, 295 S.W. 598 (1927); Postal Telegraph Cable Company v. Howe, 46 Nev. 239, 211 P. 358 (1923). There is no waiver or estoppel here.

Plaintiff also complains of lack of due process of law to it by not being afforded notice and a hearing before Defendant's tariffs filed with the Oklahoma Corporation Commission became effective and by not receiving...