Court Opinion

ID: 9721611
Source: CourtListenerOpinion
Date Created: 2023-08-26 09:03:15.633957+00
Date Added: 2024-06-11T18:24:27.672109
License: Public Domain

JUSTICE HARRISON, dissenting: The question before us in this Rule 316 (134 Ill. 2d R. 316) appeal is whether a statutory action for civil damages brought against Illinois Bell pursuant to section 5 — 201 of the Public Utilities Act (220 ILCS 5/5 — 201 (West 1992)) is barred by the exculpatory provision of a tariff filed by the company with the Illinois Commerce Commission and by the "economic loss” doctrine articulated by this court in Moorman Manufacturing Co. v. National Tank Co. (1982), 91 Ill. 2d 69. On Illinois Bell’s combined motion to dismiss (735 ILCS 5/2 — 615 (West 1992)) and for summary judgment (735 ILCS 5/2 — 1005 (West 1992)), the circuit court of Cook County held that it was. The appellate court affirmed, with one justice dissenting. (234 Ill. App. 3d 457.) This court then reversed and remanded for further proceedings, but subsequently granted Illinois Bell’s petition for reconsideration. Although the company’s petition raised no new matters, our court has now decided to change its position and affirm. For the reasons which follow, I continue to adhere to my view that we should reverse and remand to the circuit court for further proceedings. I therefore dissent. Illinois Bell’s combined motion before the circuit court was decided solely on the basis of the well-pleaded factual allegations contained in plaintiffs’ second-amended joint complaint. According to those allegations, which the parties agree we must accept as true, Illinois Bell provides the only local exchange telecommunications service within the western and southwestern suburbs of Chicago. Integral to that service are five "switching stations” which automatically route and direct telephone traffic. These five stations handle all of the local exchange telephone service for substantially all of the Chicago metropolitan area. They also handle substantially all of the long-distance telephone service for the other carriers that service Chicago. The switching station located in Hinsdale, Illinois, serves as the gateway or hub of telephone service within Chicago’s western and southwestern suburbs. This is a rapidly expanding area embracing many residential communities, major companies with regional or national headquarters, and thousands of local merchants and businesses. When fully operational, the Hinsdale station can process approximately 3.5 million calls per day. It accomplishes this using a system which is totally computerized and automated. Because human operators are not needed, the station is often left completely unmanned. Through advertising, public relations campaigns, promotions and other means, Illinois Bell has aggressively promoted the importance and reliability of its telephone service. By the time the Hinsdale station was constructed, however, Illinois Bell had abandoned the use of backup switching systems that would insure continuous telephone service in the event of a fire or other catastrophe. Accordingly, no such backup existed for the Hinsdale facility. Based on the experience of other Bell system telephone companies, Illinois Bell knew that a switching station fire could have dire adverse effects on its customers. Nevertheless, the Hinsdale facility had scant protection against fire hazards. Although Illinois Bell installed an automatic fire sensor and alarm, the alarm was not connected to any fire department. It was monitored only at an Illinois Bell office half the State away in Springfield. There was absolutely no automatic fire suppression equipment, even though such equipment was inexpensive, readily available and in common use in most large computer installations. The only firefighting equipment of any kind consisted of wall-mounted manual fire extinguishers which were useless when the station was unmanned. Sunday, May 8, 1988, was one such day when no one was present at the facility. In the middle of the afternoon, a fire broke out. At 3:50 p.m., the automatic fire alarm was triggered. The alarm registered at Illinois Bell’s monitoring office in Springfield and continued for nine consecutive minutes, but Illinois Bell took no responsive action. At approximately 4:20 p.m. the fire triggered a second alarm at the monitoring office, but again Illinois Bell took no responsive action. Finally, at 4:58 p.m., an unknown passerby who had noticed smoke pouring from the Hinsdale station alerted the local fire department. Fire fighters arrived at the scene within minutes. By that time, however, the blaze had been raging for over an hour, and the switching equipment was completely destroyed. As a direct result of the equipment’s destruction, telephone service in the western and southwestern suburbs of Chicago was disrupted. Illinois Bell lacked adequate facilities of its own to restore this service on a temporary basis and refused to install emergency equipment which could have promptly restored service, even though such equipment had been offered to the company by various firms within 72 hours of the fire and was available at reasonable cost. When permanent repairs were initiated by the company, they took over a month to complete. Throughout this period Illinois Bell customers in the affected area were left without telephone service, causing them to suffer "significant expense, lost business, lost profits and serious inconvenience and threats to their health, safety and well-being.” Based upon these events, many of the affected Illinois Bell customers filed class actions pursuant to section 2 — 801 et seq. of the Code of Civil Procedure (735 ILCS 5/2 — 801 et seq. (West 1992)) in the circuit court of Cook County to recover damages from the company. Five such actions were subsequently consolidated by the circuit court pursuant to section 2 — 1006 of the Code of Civil Procedure (735 ILCS 5/2 — 1006 (West 1992)), and the plaintiffs in these consolidated actions filed a joint amended complaint. In their complaint, plaintiffs purported to represent "[a]ll those who on May 8, 1988 were local exchange business or residential customers of Illinois Bell and whose telephone service was halted, disrupted or otherwise adversely affected as a result of the May 8, 1988 fire at the Hinsdale station.” Before the circuit court passed on the question of whether the action should, in fact, be maintained as a class action (735 ILCS 5/2 — 802(a) (West 1992)), it dismissed the first-amended joint complaint on Illinois Bell’s motion on the grounds that it was substantially insufficient in law. This dismissal was without prejudice. Plaintiffs then filed a second-amended joint complaint which contained five counts. Counts I and II asserted a statutory claim for civil damages under section 5 — 201 of the Public Utilities Act (220 ILCS 5/5 — 201 (West 1992)). Count III alleged willful and wanton misconduct, and count IV claimed breach of contract. Count V advanced no new substantive claims, but simply asked for a declaratory judgment (735 ILCS 5/2 — 701 (West 1992)) that none of the preceding counts was barred by the exculpatory terms of a tariff Illinois Bell had filed with the Illinois Commerce Commission. On Illinois Bell’s motion, the circuit court dismissed counts I through IV as being substantially insufficient in law (735 ILCS 5/2 — 615 (West 1992)) and granted summary judgment (735 ILCS 5/2 — 1005 (West 1992)) in favor of Illinois Bell on count V. The customers elected to stand on their pleadings and appealed the dismissal of counts I and II. They also appealed the entry of summary judgment against them on count V. The appellate court affirmed the circuit court’s judgment, over the dissent of Justice Scariano, but issued a certificate of importance pursuant to Supreme Court Rule 316 (134 Ill. 2d R. 316). Although we initially reversed and remanded, we subsequently granted Illinois Bell’s petition for reconsideration. The matter is therefore before us once again for review. As just mentioned, counts I and II of plaintiffs’ second-amended joint complaint asserted a statutory claim for civil damages pursuant to section 5 — 201 of the Public Utilities Act (220 ILCS 5/5 — 201 (West 1992)). That statute, which is applicable to Illinois Bell by virtue of section 13 — 101 of the Universal Telephone Service Protection Law of 1985 (220 ILCS 5/13 — 101 (West 1992)), provides: "In case any public utility shall do, cause to be done or permit to be done any act, matter or thing prohibited, forbidden or declared to be unlawful, or shall omit to do any act, matter or thing required to be done either by any provisions of this Act or any rule, regulation, order or decision of the [Illinois Commerce] Commission, issued under authority of this Act, the public utility shall be liable to the persons or corporations affected thereby for all loss, damages or injury caused thereby or resulting therefrom, and if the court shall find that the act or omission was wilful, the court may in addition to the actual damages, award damages for the sake of example and by the way of punishment.” 220 ILCS 5/5 — 201 (West 1992). In count I plaintiffs claimed they were entitled to damages under this statute because their injuries were caused by Illinois Bell’s failure to comply with two particular provisions of the Public Utilities Act: section 8 — 101 (220 ILCS 5/8 — 101 (West 1992)) and section 8 — 401 (220 ILCS 5/8 — 401 (West 1992)). Under section 8 — 101, Illinois Bell was required to "furnish, provide and maintain such service instrumentalities, equipment and facilities as shall promote the safety, health, comfort and convenience of its patrons, employees and public and as shall be in all respects adequate, efficient, just and reasonable.” (220 ILCS 5/8 — 101 (West 1992).) Pursuant to section 8 — 401, it also had a duty to "provide service and facilities which are in all respects adequate, efficient, reliable and environmentally safe.” 220 ILCS 5/8 — 401 (West 1992). According to plaintiffs, Illinois Bell violated these two provisions in that it (1) failed to provide adequate, efficient, and reasonable responses to the two fire alarms that went off at the Springfield monitoring office; (2) failed to equip the Hinsdale switching station with adequate, efficient and reasonable fire suppression equipment; (3) failed to provide adequate efficient and reasonable staffing of the Hinsdale station so that the manual fire extinguishers located there could be used in case of fire; (4) failed to provide adequate, efficient and reasonable procedures to be followed by Illinois Bell employees for reporting fires to local fire departments; (5) failed to provide adequate, efficient and reasonable fire alarm systems at the Hinsdale station which would have automatically sounded at the local fire department; (6) failed to provide adequate, efficient and reasonable training for Illinois Bell personnel who monitored fire alarms at the Hinsdale station; (7) failed to provide adequate, efficient and reasonable back-up switching equipment at the station which could be used in case of fire or other natural disaster there; and (8) failed to install temporary emergency replacement equipment to service the affected area. As an additional basis for recovery plaintiffs claimed that Illinois Bell should be held liable under section 5 — 201 of the Act because it violated certain regulations promulgated by the Illinois Commerce Commission. Under those regulations, Illinois Bell was obligated to adopt and pursue a maintenance program aimed at preventing service interruptions (83 Ill. Adm. Code § 730.402(a) (1991)), and to keep "all plant and equipment in the good state of repair consistent with the design capabilities of the plant affected,” which includes repairing or replacing "broken, damaged, or deteriorated parts which are no longer serviceable” (83 Ill. Adm. Code § 730.402(b) (1991)). Illinois Bell was also required to "make reasonable provisions to meet emergencies resulting from failures of lighting or power service, sudden and prolonged increases in traffic, illness or personnel, or from fire, storm, or other acts of God ***.” (Emphasis added.) (83 Ill. Adm. Code § 730.408(a) (1991).) In count I plaintiffs alleged that Illinois Bell breached these obligations when it failed to take reasonable steps to obtain emergency equipment and facilities to restore service following the fire. Count II incorporated all of count I’s allegations, but included the additional charge that Bell’s violations of the specified statutes and regulations were "willful” within the meaning of section 5 — 201 of the Public Utilities Act. In affirming the dismissal of both counts I and II, the appellate court held that plaintiffs were barred from recovering consequential damages from Illinois Bell by virtue of the exculpatory provisions of a tariff filed by the company with the Illinois Commerce Commission. That tariff provides: "The liability of the Company for damages arising out of mistakes, omissions, interruptions, delays, errors or defects in transmission occurring in the course of furnishing service or other facilities, and not caused by the negligence of customer, shall in no event exceed an amount equivalent to the proportionate charge to the customer for the period of service during which such mistake, omission, interruption, delay, error or defect in transmission occurs. No other liability shall in any case attach to the Company.” The appellate court correctly observed that similar exculpatory provisions have been found to preclude the recovery of consequential damages for interruption of phone service in both administrative proceedings before the Commerce Commission (Menco v. Illinois Bell Telephone Co. (Illinois Commerce Commission October 17, 1984), No. 84 — 0277), and civil court actions (J. Meyer & Co. v. Illinois Bell Telephone Co. (1980), 88 Ill. App. 3d 53; Sarelas v. Illinois Bell Telephone Co. (1963), 42 Ill. App. 2d 372). In contrast to the present case, however, none of the authorities invoked by the appellate court involved statutory damages claims brought under section 5 — 201 of the Public Utilities Act. This distinction is critical, for as Justice Scariano noted in his dissent, that statute clearly and unambiguously makes Illinois Bell liable for "all loss, damages or injury” caused by or resulting from Bell’s violation of the Act and the Commission’s regulations, and further provides for the recovery of punitive, as well as actual, damages where, as alleged here, the violation, is willful. 234 Ill. App. 3d at 469-70 (Scariano, J., dissenting). Nothing in the Public Utilities Act or the Commission’s regulations authorizes a utility to exempt itself from this liability by means of a tariff. Nor may any such exemption be conferred on a public utility by the Commerce Commission. This is so because, as a creature of the legislature, the Commerce Commission derives its authority solely from the statute creating it, i.e., the Public Utility Act, and any acts it takes or orders it makes inconsistent with that act are void. City of Chicago v. Illinois Commerce Comm’n (1980), 79 Ill. 2d 213, 217-18. In an effort to avoid this conclusion, Illinois Bell makes the somewhat startling assertion that the exculpatory provision in the tariff does not, in fact, conflict with the terms of section 5 — 201 of the Act. It does not conflict, according to the company, because the tariff and the tariff alone defines its obligations to its customers. This contention is completely untenable. As plaintiffs have alleged in their second-amended joint complaint, numerous duties are expressly imposed on Illinois Bell by the Public Utilities Act. To say such duties are not controlling is tantamount to holding that by filing a tariff and obtaining the approval, or at least acquiescence of the Commerce Commission, a utility has the power to nullify the regulatory scheme enacted by the General Assembly. For the reasons just stated, the law will not countenance such a result. By any reasonable construction of the statutory framework, tariffs are intended to ensure that utilities comply with the Public Utilities Act, not to provide them an opportunity for evading it. As an additional basis for giving the tariff preclusive effect over section 5 — 201 of the Act, the appellate court reasoned that if Illinois Bell were not permitted to limit its liability in cases such as this, its potential liability might be so great that its ability to provide telephone service at reasonable rates would be compromised. Plaintiffs have specifically alleged, however, that Bell is a profitable corporation "well able to afford to pay plaintiffs *** the amount of damages they suffered without having to raise rates to fund such payment.” The appellate court had no legitimate basis for ignoring this allegation, for, as I noted at the outset of this dissent, this matter is still at the pleading stage, and the parties agree that all well-pleaded factual allegations must be taken as true. The appellate court’s reasoning must also fail because it forgets that the Public Utility Act’s remedial scheme is a legislative creation. It was for the General Assembly to balance the policy considerations at stake, and there is no basis for assuming that the General Assembly did not fully appreciate how utilities such as Illinois Bell might be affected by the enactment of section 5 — 201. Now that the legislature has spoken clearly and unambiguously, the court’s only legitimate function is to enforce the law as enacted. The law should not be rewritten to make it consistent "with the court’s idea of orderliness and public policy.” Kozak v. Retirement Board of the Firemen’s Annuity & Benefit Fund (1983), 95 Ill. 2d 211, 220. For similar reasons I find no merit to the appellate court’s alternative holding that counts I and II of the second-amended joint complaint were properly dismissed pursuant to the "economic loss” doctrine articulated by this court in Moorman Manufacturing Co. v. National Tank Co. (1982), 91 Ill. 2d 69. That doctrine holds that economic losses, defined as those damages sought " 'for inadequate value, costs of repair and replacement of the defective product, or consequent loss of profits — without any claim of personal injury or damage to other property ***’ [citation] as well as the 'diminution in the value of the product because it is inferior in quality and does not work for the general purposes for which it was manufactured and sold’ ” (Moorman, 91 Ill. 2d at 82), are not recoverable in tort. Anderson Electric, Inc. v. Moorman, Ledbetter Erection Corp. (1986), 115 Ill. 2d 146, 149. Plaintiffs protest that this doctrine is inapplicable because the interruption of their phone service did constitute damage to "other property.” It is unnecessary to address this contention, however, for even if plaintiffs’ characterization of their loss is incorrect, their right to recovery is not defeated. Under the express language of section 5 — 201, it does not matter whether the loss is "economic” in nature or not. By its terms, that statute permits recovery for all loss, damages or injury caused by or resulting from a utility’s violation of the Public Utility Act or Commission regulations. Where, as here, the damages sought are expressly authorized by statute, Moorman does not apply. Warren v. LeMay (1986), 142 Ill. App. 3d 550, 579. Although it acknowledged that no reported decision has ever held otherwise, the appellate court reached a contrary conclusion by invoking the principle that statutes which are in derogation of the common law will not be construed as abrogating common tort law principles such as Moorman unless the statutes plainly show that that was the legislature’s intention. (See Barthel v. Illinois Central Gulf R.R. Co. (1978), 74 Ill. 2d 213, 221.) What the appellate court majority failed to heed is Justice Scariano’s reminder that the best indicator of legislative intent is the language used. The language used here could not be any clearer in authorizing the damages plaintiffs seek. It is never proper for a court to depart from the plain language of a statute by reading into it exceptions, limitations, or conditions which conflict with such clearly expressed legislative intent. Certain Taxpayers v. Sheahen (1970), 45 Ill. 2d 75, 84. By invoking Moorman to limit the language of section 5 — 201, the appellate court also overlooked two other basic rules of statutory construction. In interpreting a statute a court must look at the state of the law as it existed at the time of a statute’s enactment. {Illinois Bell Telephone Co. v. Allphin (1982), 93 Ill. 2d 241, 249.) Correspondingly, "[t]he legislative intent that controls in the construction of a statute has reference to the legislature which passed the given act.” People v. Boreman (1948), 401 Ill. 566, 572. Section 5 — 201 has been in effect in one form or another since the early part of the century. The Moorman doctrine, however, was not announced by our court until 1982. At the time section 5 — 201 was first enacted, the legislature could therefore have had no possible reason to believe that it needed to account for Moorman’s restrictions. Moorman did not even exist. There is no dispute that the legislature may change existing common law by enacting new legislation. The courts, however, have no coordinate right to change existing legislation by pronouncing new principles of common law. By applying Moorman to limit the plain language of section 5 — 201, that is precisely what the appellate court here did. As support for its position, the appellate court relied on this court’s decision in Barthel, 74 Ill. 2d 213. That case, however, did not make the errors I have just discussed and involved substantially different circumstances. Barthel was concerned with the question of whether contributory negligence could be raised by the defendant in an action under the predecessor provision to section 5 — 201. Under the law at that time, a plaintiff’s contributory negligence was a complete bar to recovery. The plaintiffs in Barthel argued that this defense should not apply to actions under the statute and that the statute was meant to impose strict liability on offending public utilities. This court rejected plaintiffs’ argument, holding that the social policy requiring imposition of strict liability did not come into play with respect to the Public Utilities Act (Barthel, 74 Ill. 2d at 222) and that contributory negligence was a defense under that statute, just as it was in various other statutory actions (Barthel, 74 Ill. 2d at 224-25). In no way, however, did Barthel purport to limit the type of damages recoverable under the Act, as the appellate court did in this case, nor did it sanction the application of new common law principles to legislation already in existence. Although the majority opinion of this court advances various legal arguments in support of the appellate court’s judgment, the true basis for its result may be reflected in its conclusion that if plaintiffs prevail, they "could well end up owning the telephone company.” (161 Ill. 2d at 246.) I for one see no particular objection to such a result. If the plaintiff customers were in control of the system, they might well take better care of it. At the very least, they might have the sense to call the fire department before a major link in the network is reduced to a mass of melted wire. In any case, it is not our function to protect the telephone company, or any party, from the consequences of its misconduct. We exist not to defend corporate status quo, but to interpret and apply the law. For the foregoing reasons, I would hold that the circuit court erred in dismissing counts I and II of plaintiffs’ second-amended joint complaint, and in granting summary judgment for Illinois Bell on count V of that complaint. Accordingly, I would reverse the judgments of the circuit court and the appellate court and remand this cause to the circuit court for further proceedings. I therefore dissent. CHIEF JUSTICE BILANDIC joins in this dissent.