Title: Allstate Ins. Co. v. Cleveland Elec. Illum. Co.

State: ohio

Issuer: Ohio Supreme Court

Document:

[Cite as Allstate Ins. Co. v. Cleveland Elec. Illum. Co., 119 Ohio St.3d 301, 2008-Ohio-3917.] 
 
 
 
ALLSTATE INSURANCE COMPANY, APPELLANT, v. CLEVELAND  
ELECTRIC ILLUMINATING COMPANY, APPELLEE. 
[Cite as Allstate Ins. Co. v. Cleveland Elec. Illum. Co.,  
119 Ohio St.3d 301, 2008-Ohio-3917.] 
Jurisdiction — Court of common pleas has jurisdiction over common-law tort 
claim brought against a utility. 
(No. 2007-0452 — Submitted February 26, 2008 — Decided August 12, 2008.) 
APPEAL from the Court of Appeals for Cuyahoga County,  
No. 87781, 2007-Ohio-157. 
__________________ 
PFEIFER, J. 
{¶ 1} Appellant Allstate Insurance Company contends that the trial court 
had jurisdiction to determine its subrogation claim against appellee Cleveland 
Electric Illuminating Company (“CEI”).  Allstate alleged that CEI was negligent 
in failing to respond to a customer’s service call and that Allstate was obligated to 
pay claims to two of its insureds when a fire and property damage occurred.  This 
case comes down to a simple question: Is the claim underlying Allstate’s 
subrogation claim service-related or is it a pure common-law tort claim?  Because 
we conclude that Allstate’s claim arises from a common-law tort and is outside 
the expertise of the Public Utility Commission of Ohio (“PUCO”), we hold that 
Allstate’s claim was properly tried in the court of common pleas. 
Facts and Procedural History 
{¶ 2} On the morning of July 20, 2005, Margaret Harris and her 
daughter, Lisa Little, noticed that a large tree limb had broken and was leaning on 
service wires connected to the duplex where they lived.  The tension from the 
limb had caused the electrical service mast to pull away from the duplex; it 
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appeared to Harris and Little that a wire had snapped.  Harris called CEI before 
noon to report the situation.  She spoke with a customer service representative, 
who entered the information into the company’s system.  After a couple of hours 
passed without a response from CEI, Harris called again.  Again, there was no 
response from CEI.  Harris called a final time before 5:00 p.m.  Shortly after this 
final call, the wires broke and the resulting sparks set the duplex on fire.  Harris 
called the fire department, which arrived promptly, but it was unable to prevent 
extensive damage.  CEI finally arrived at the Harris residence after the fire had 
started. 
{¶ 3} Harris and her neighbor Anna Kaplan both submitted claims for 
damages under their respective Allstate homeowner’s insurance policies.  Allstate 
paid $149,357.34 to Harris and $12,435.13 to Kaplan, and then filed a 
subrogation claim in the Cuyahoga County Court of Common Pleas, alleging that 
CEI was negligent in failing to respond to the emergency calls. 
{¶ 4} Shortly after Allstate filed its complaint, CEI moved the trial court 
to dismiss for lack of subject-matter jurisdiction, pursuant to Civ.R. 12(B)(1), 
arguing that PUCO has exclusive jurisdiction of all claims relating to electrical 
service.  The trial court denied CEI’s motion, and a trial proceeded.  A jury found 
CEI 100 percent negligent and awarded Allstate $161,792.47 in damages, the 
amount it had paid to Harris and Kaplan.  CEI appealed, alleging, among other 
things, that the trial court did not have jurisdiction to hear the case.  The court of 
appeals reversed and remanded, instructing the trial court to dismiss the action 
based on its determination that PUCO has exclusive jurisdiction over the matter.  
We accepted Allstate’s discretionary appeal. 
Analysis 
{¶ 5} PUCO has exclusive jurisdiction over most matters concerning 
public utilities.  “The General Assembly, by the enactment of statutory provisions 
requiring a public utility to file and adhere to rate schedules, forbidding 
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discrimination among its customers, prohibiting free service, and providing a 
detailed procedure for service and rate complaints, has lodged exclusive 
jurisdiction in such matters in the Public Utilities Commission, subject to review 
by the Supreme Court.”  State ex rel. N. Ohio Tel. Co. v. Winter (1970), 23 Ohio 
St.2d 6, 52 O.O.2d 29, 260 N.E.2d 827, paragraph one of the syllabus. 
{¶ 6} That PUCO has exclusive jurisdiction over service-related matters 
does not diminish “the basic jurisdiction of the court of common pleas * * * in 
other areas of possible claims against utilities, including pure tort and contract 
claims.”  State ex rel. Ohio Edison Co. v. Shaker (1994), 68 Ohio St.3d 209, 211, 
625 N.E.2d 608.  See Kazmaier Supermarket, Inc. v. Toledo Edison Co. (1991), 
61 Ohio St.3d 147, 154, 573 N.E.2d 655 (“pure common-law tort claims may be 
brought against utilities in the common pleas court”); Milligan v. Ohio Bell Tel. 
Co. (1978), 56 Ohio St.2d 191, 195, 10 O.O.3d 352, 383 N.E.2d 575 (claim that 
telephone company invaded customer’s privacy was actionable in common pleas 
court); see also Kohli v. Pub. Util. Comm. (1985), 18 Ohio St.3d 12, 14, 18 OBR 
10, 479 N.E.2d 840 (PUCO noted in its decision that a failure to warn landowners 
of dangers regarding voltage sounded in tort and was more properly cognizable in 
common pleas court).  Moreover, PUCO is not a court and has no power to 
judicially ascertain and determine legal rights and liabilities.  State ex rel. Dayton 
Power & Light Co. v. Riley (1978), 53 Ohio St.2d 168, 170, 7 O.O.3d 317, 373 
N.E.2d 385.  See New Bremen v. Pub. Util. Comm. (1921), 103 Ohio St. 23, 30-
31, 132 N.E. 162 (PUCO “has no power to judicially ascertain and determine 
legal rights and liabilities”). 
{¶ 7} We must determine whether PUCO has exclusive jurisdiction over 
the subrogation claim filed by Allstate against CEI.  To do that, we must 
determine whether the claim is service-related or whether it involves a common-
law tort.  As a preliminary matter, we categorically reject CEI’s implicit argument 
that everything it does is service-related.  See Harris v. Ohio Edison Co. (Aug. 
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17, 1995), Mahoning App. No. 94 C.A. 84, 1995 WL 494584 (PUCO does not 
have exclusive jurisdiction over every action of a public utility). 
{¶ 8} Allstate’s complaint alleges that CEI was negligent.  Negligence is 
a common-law tort.  At one time, the mere allegation that a complaint sounded in 
tort may have been enough to confer jurisdiction on the court of common pleas.  
See Milligan, 56 Ohio St.2d at 195, 10 O.O.3d 352, 383 N.E.2d 575 (a complaint 
sounding in tort “confers power upon the court [of common pleas] to hear the 
claim, and it is incumbent for it to do so unless the claim is alleged solely for the 
purpose of obtaining jurisdiction or is wholly insubstantial or frivolous”).  We 
have held, however, that in cases involving public utilities, jurisdiction is not 
conferred based solely on pleadings.  State ex rel. Columbia Gas of Ohio, Inc. v. 
Henson, 102 Ohio St.3d 349, 2004-Ohio-3208, 810 N.E.2d 953, ¶ 19 (mere fact 
that allegations were cast so as “to sound in tort is insufficient to confer 
jurisdiction upon the common pleas court”).  See State ex rel. Illum. Co. v. 
Cuyahoga Cty. Court of Common Pleas, 97 Ohio St.3d 69, 2002-Ohio-5312, 776 
N.E.2d 92, ¶ 21. 
{¶ 9} In Henson, the complaint alleged that Columbia Gas had tortiously 
interfered with a business relationship.  102 Ohio St.3d 349, 2004-Ohio-3208, 810 
N.E.2d 953, at ¶ 18.  The substance of the claim involved “Columbia Gas’s 
termination and restoration of natural-gas service.”  Id. at ¶ 20.  We determined 
that the claim was service-related and therefore within the exclusive jurisdiction 
of PUCO.  Id.  In Kazmaier, despite the nature of the allegation, the substance of 
the claim involved a dispute over the rate charged, a matter patently within the 
jurisdiction of PUCO.  61 Ohio St.3d at 153, 573 N.E.2d 655.  Most claims are 
not so close to one end of the continuum between rate- or service-related and 
common-law tort. 
{¶ 10} In the present case, both parties make strong arguments for why 
they should prevail.  CEI argues that if it was negligent, it was negligent regarding 
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its own policies and procedures relating to service calls, and that determinations 
regarding a public utility’s policies and procedures are within the exclusive 
jurisdiction of PUCO.  Allstate argues that CEI had a duty to exercise reasonable 
care for the safety of Harris’s property, that CEI breached that duty, and that 
determinations regarding negligence are within the jurisdiction of the court of 
common pleas.  We concede that the distinction between the two arguments is a 
fine one. 
{¶ 11} Trial courts determine their own jurisdiction.  State ex rel. Ohio 
Edison Co. v. Shaker (1994), 68 Ohio St.3d 209, 211, 625 N.E.2d 608.  Their 
determinations, however, can be challenged, as was done in this case.  To help us 
and all other courts determine when a trial court’s determination that it, not 
PUCO, has jurisdiction over a case involving a public utility alleged to have 
committed a tort, we hereby adopt the following test from Pacific Indemn. Ins. 
Co. v. Illum. Co., Cuyahoga App. No. 82074, 2003-Ohio-3954, 2003 WL 
21710787, ¶ 15: 
{¶ 12} “First, is PUCO’s administrative expertise required to resolve the 
issue in dispute?  Second, does the act complained of constitute a practice 
normally authorized by the utility?” 
{¶ 13} If the answer to either question is in the negative, the claim is not 
within PUCO’s exclusive jurisdiction. 
{¶ 14} We now apply this test to the case before us.  The substance of 
Allstate’s claim is that CEI was negligent in failing to respond to emergency calls 
from the Harris residence.  This claim is no different from those brought against a 
business that negligently fails to correct a known dangerous condition on its 
property.  See Kohli, 18 Ohio St.3d at 14, 18 OBR 10, 479 N.E.2d 840 (failure to 
warn landowners of dangers regarding voltage sounded in tort).  The ultimate 
question in this case is whether the delay between CEI’s receipt of the emergency 
calls and arrival at the Harris residence was reasonable.  That issue is particularly 
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appropriate for resolution by a jury.  The expertise of PUCO is not necessary to 
the resolution of this case.  Accordingly, PUCO does not have exclusive 
jurisdiction over this case. 
{¶ 15} CEI claims that it has guidelines in place that govern how it 
responds to emergency calls.  CEI argues that its guidelines constitute a “practice 
* * * relating to any service furnished by the public utility,” R.C. 4905.26, and, 
therefore, that Allstate’s claim is service-related and is within the exclusive 
jurisdiction of PUCO.  The test we adopt today is not conjunctive; we need not 
address the second question because the answer to the first question – whether the 
utility’s action constitutes a practice normally authorized by the utility – is that 
PUCO does not have exclusive jurisdiction.  Moreover, we are not persuaded that 
a guideline that allows an emergency call to go without response for over six 
hours can be relied upon to avoid the general jurisdiction of the court of common 
pleas. 
Conclusion 
{¶ 16} Allstate’s claim of negligence was properly before the court of 
common pleas.  Moreover, even if Allstate had taken its complaint to PUCO, the 
commission lacks the authority to “determine legal rights and liabilities.”  New 
Bremen, 103 Ohio St. at 30-31, 132 N.E. 162.  It would have been wasteful and 
futile for Allstate to seek subrogation through PUCO.  We conclude that the trial 
court properly determined that it had jurisdiction of this tort action and that it 
properly denied CEI's motion to dismiss.  We reverse the judgment of the court of 
appeals.  Because the court of appeals’ erroneous disposition of the issue before 
us led it to hold that CEI’s remaining assignments of error were moot, we remand 
to the court of appeals for consideration of those issues. 
Judgment reversed 
 and cause remanded. 
January Term, 2008 
7 
 
MOYER, C.J., and LUNDBERG STRATTON, O’CONNOR, O’DONNELL, and 
LANZINGER, JJ., concur. 
 
CUPP, J., concurs in judgment only. 
__________________ 
Grotefeld & Hoffmann, L.L.P., Lynn K. Weaver, and Mark S. Grotefeld; 
and McCarthy, Lebit, Crystal & Liffman Co., L.P.A., and Leslie E. Wargo, for 
appellant. 
Calfee, Halter & Griswold, L.L.P., Thomas I. Michals, and Anthony F. 
Stringer, for appellee. 
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