Tyus v. Indianapolis Power & Light Co.

• Decision Date: 16 September 2019
• Docket Number: Court of Appeals Case No. 18A-CT-828
• Citation: 134 N.E.3d 389
• Parties: Kenyon TYUS, Jr., Kyrie Tyus, Keyon Tyus, Amber Tyus, and Kenyon Tyus, Appellants/Cross-Appellees-Plaintiffs, v. INDIANAPOLIS POWER & LIGHT COMPANY, The City of Indianapolis, Indianapolis Department of Public Works, and Wright Tree Service Inc. d/b/a Wright Tree Service, Appellee/Cross-Appellant-Defendant.
• Court: Indiana Appellate Court

134 N.E.3d 389

Kenyon TYUS, Jr., Kyrie Tyus, Keyon Tyus, Amber Tyus, and Kenyon Tyus, Appellants/Cross-Appellees-Plaintiffs,

v.INDIANAPOLIS POWER & LIGHT COMPANY, The City of Indianapolis, Indianapolis Department of Public Works, and Wright Tree Service Inc. d/b/a Wright Tree Service,¹ Appellee/Cross-Appellant-Defendant.

Court of Appeals Case No. 18A-CT-828

Court of Appeals of Indiana.

FILED September 16, 2019

Attorneys for Appellants: William E. Winingham, Jonathon B. Noyes, Wilson Kehoe Winingham, LLC, Indianapolis, Indiana, Ned Miltenberg, Washington, D.C.

Attorneys for Amicus Curiae Indiana Trial Lawyers Association: Tyler J. Zipes, Nicholas C. Deets, Hovde Dassow & Deets, LLC, Indianapolis, Indiana

Attorneys for Appellee Indianapolis Power & Light: Joshua B. Fleming, Lucy R. Dollens, Quarles & Brady LLP, Indianapolis, Indiana, T. Joseph Wendt, Alejandra Reichard, Barnes & Thornburg LLP, Indianapolis, Indiana

Attorneys for Appellee Wright Tree Service Inc.: Kevin C. Schiferl, Amy Stewart Johnson, Darren A. Craig, Frost Brown Todd LLC, Indianapolis, Indiana

Attorneys for Amicus Curiae Indiana Energy Association: Wayne C. Turner, Patrick A. Ziepolt, Hoover Hull Turner LLP, Indianapolis, Indiana

Attorneys for Amicus Curiae Indiana Legal Foundation: Jane Dall Wilson, Emily Kile-Maxwell, Faegre Baker Daniels LLP, Indianapolis, Indiana

Kirsch, Judge.

[1] In the underlying action, Amber Tyus ("Amber"), her husband, Kenyon Tyus ("Kenyon"), and their three children, Kenyon Tyus, Jr. ("Kenyon, Jr."), Keyon Tyus ("Keyon"), and Kyrie Tyus ("Kyrie") (collectively, "the Tyuses") sued Indianapolis Power & Light Company ("IPL"), among others, for various acts of common law negligence and gross negligence. The Tyuses, who were not IPL customers, sought recovery for injuries sustained when Amber and her three children were involved in an automobile accident at a busy Indianapolis intersection where IPL-operated traffic signals remained dark for more than eight hours after they were disabled by a storm. IPL moved for judgment on the pleadings based largely on the defense that IPL's schedule of rates, rules, and regulations for supplying electricity to customers ("the 2016 Tariff"), which had been filed with and approved by the Indiana Utility Regulatory Commission ("IURC") on March 16, 2016, provided a release from liability. Specifically, IPL argued that Rule 24.2, in part, released IPL from liability for injuries to third persons resulting from an interruption of service or supply of electricity, "unless due to willful default or neglect on the part of [IPL]" ("the Release Clause"). Appellee's App. Vol. 4 at 91. The trial court granted IPL's motion for judgment on the pleadings as to the Tyuses' negligence claim but allowed their claim of gross negligence to proceed to trial.

[2] The Tyuses bring this discretionary interlocutory appeal raising five constitutional issues,² of which we find the following issue to be dispositive:

I. Whether the trial court erred in granting IPL's motion for judgment on the pleadings, after finding that the Release Clause precluded IPL from being liable to the Tyuses for damages resulting from IPL's negligent interruption in the supply of electricity, when, the Tyuses argue, the IURC's act of approving the Release Clause exceeded the IURC's delegated powers.

IPL cross appeals raising three issues,³ which we restate as:

II. Whether the Tyuses are barred from raising a constitutional issue for the first time on appeal;

III. Whether the trial court and our court lack subject matter jurisdiction because the Tyuses' suit is an improper collateral attack on the 2016 Tariff; and the Release Clause is inextricably connected to rate making and, thus falls within the IURC's expertise and jurisdiction; and

IV. Whether, even without the Release Clause, judgment on the pleadings for the Tyuses' negligence claim is appropriate because IPL owes the Tyuses no duty of care.

[3] We affirm in part, reverse in part, and remand for further proceedings.

Facts and Procedural History⁴

The Accident

[4] During a storm on the afternoon of April 2, 2016, a tree branch fell, downing power lines near the intersection of Binford Boulevard and Kessler Boulevard ("the Intersection") in the City of Indianapolis, Indiana ("the City"). The resulting power outage caused IPL-operated traffic signals at the Intersection to go dark at 3:14 p.m. that day. Appellants' App. Vol. 2 at 66. An hour later, at 4:14 p.m., IPL "was notified that the entire electrical circuit" at the Intersection had lost power. Id. at 67. About twenty-five minutes later, at 4:39 p.m., IPL was notified that the traffic signals and surrounding lights at the Intersection were out in every direction. Id. At 8:26 p.m., about five hours after the traffic signals had lost power, IPL "was again notified in an emergency call" that the traffic signals and lighting at and surrounding the Intersection had no power. Id. By 11:00 p.m., IPL "had received at least thirteen separate notifications that the [I]ntersection's circuit had lost power." Id. At 11:17 p.m., about eight hours after the traffic signals initially went black, the Intersection and its surrounding street lights were still completely without power and there was no traffic control at the Intersection. Id.

[5] That night, around 11:20 p.m., Amber was driving westbound on Kessler Boulevard with her three sons—ten-year-old Kenyon, Jr., seven-year-old Keyon, and two-year-old Kyrie. Id. at 68. As Amber entered the Intersection, her vehicle was t-boned by a vehicle operated by Brian Ruark who, with passenger Jonell Carrier, was traveling northbound on Binford Boulevard.⁵ The crash caused catastrophic injuries to members of the Tyus family. Id. Amber suffered severe fractures and other orthopedic injuries. Id. Kenyon, Jr. suffered a severe traumatic brain injury and is now confined to a hospital bed without the ability to walk, talk, or feed himself. Id. Kyrie suffered a severe traumatic brain injury, rendering him unable to form sentences or have normal control over the left side of his body. Id. Keyon suffered bodily injuries and severe emotional damage after witnessing the crash and his family's condition. Id.

[6] IPL is a domestic, investor-owned, electric utility.⁶ In 2016, pursuant to a "Public Lighting Contract" between the City, as customer, and IPL ("the IPL Contract"), IPL supplied equipment and electricity to the City's traffic signals, including those at the Intersection.⁷ The IURC is an administrative agency of the State and "has legislative authority to set rates or charges for regulated public utilities, including electric utilities." Ind. Energy Ass'n Amicus Br. at 9. IPL is subject to regulation by the IURC.

Procedural History

[7] On December 9, 2016, the Tyuses filed their initial complaint against IPL seeking damages for injuries sustained.⁸ Thereafter, the Tyuses filed an amended complaint and, thereafter, a second amended complaint on May 17, 2017 ("the Amended Complaint"). Appellants' App. Vol. 2 at 43-53, 54-64, 65-77. In the Amended Complaint, the Tyuses alleged that IPL "knew or should have known of the power outage at the intersection of Binford Boulevard and Kessler Boulevard in Indianapolis, Indiana for over eight hours prior to the Tyus[es]' collision." Id. at 69. The Tyuses further alleged that IPL uses a system to locate outages that became outdated decades ago. Specifically, the Tyuses alleged:

[IPL] was negligent and careless in one or more of the following respects:

a. Failing to properly monitor and maintain the power to the [I]ntersection.

b. Failing to timely and properly restore power to the [I]ntersection after power to the [I]ntersection was lost.

c. Failing to properly maintain power lines and trees in order to prevent power outages.

d. Failing to use a reasonable system for diagnosing and correcting power outages in [the City].

e. Failing to act as a reasonable utility in regard to maintenance, monitoring, and upkeep of traffic signals in [the City].

Id. at 69-70. The Tyuses further alleged that IPL's "conduct constitute[d] gross negligence and reckless misconduct in view of its failure to restore power to the traffic [signals] and street lights at a high[-]volume intersection for a period in excess of [thirteen] hours." Id. at 70. IPL filed its answer on June 6, 2017.

[8] On September 12, 2017, IPL moved for judgment on the pleadings because the IURC-approved 2016 Tariff "preclude[d] IPL's liability for damages resulting from interruptions in the supply of electricity," and the matter should be referred to the IURC for its interpretation of the meaning of the 2016 Tariff. Id. at 81. IPL also moved to dismiss the Tyuses' claims, arguing that IPL did not owe the Tyuses a duty of care and, as such, the Tyuses' "[Amended C]omplaint fail[ed] to state a claim upon which relief can be granted against IPL as a matter of law." Id. In its motion for judgment on the pleadings, IPL relied in large part on its belief that the IURC-approved 2016 Tariff provided a complete defense to the Tyuses' claims. Specifically, IPL focused on the following italicized language of the Release Clause:

24 Release of Company from Liability.

.... 24.2 [IPL] shall not be liable for damages resulting to the Customer, or to third persons, from the use of electricity , interruption of service or supply , or the presence of the [IPL]'s property on the Customer's premises, unless due to willful default or neglect on the part of [IPL].

Appellee's App. Vol. 4 at 91. Based upon this limitation of liability in the 2016 Tariff, IPL argued that it was shielded from the liability asserted against it in the Tyuses' Amended Complaint, and, therefore, the Tyuses' claims against IPL failed as a matter of law. Appellants' App. Vol. 2 at 36. IPL alleged that the Release Clause "preclude[d] IPL's liability for damages resulting [to the Tyuses] from interruptions in the supply of electricity ...." Id. at 81.

[9] In the alternative, IPL argued that the...