Court Opinion

ID: 9721610
Source: CourtListenerOpinion
Date Created: 2023-08-26 09:03:15.619966+00
Date Added: 2024-06-11T18:24:27.669149
License: Public Domain

JUSTICE MILLER, specially concurring: I concur in the judgment of the court. I agree with the majority that the limitation on liability contained in Illinois Bell Telephone Company’s tariff bars the present action and restricts the plaintiffs’ recovery for the service outage involved here to the amounts paid by the plaintiffs for telephone services during the affected period. I write separately, however, to explain more fully my reasons for reaching this conclusion. Because the tariff provides a complete and independent answer in this case, we need not consider, and I do not address, the distinct question whether the Moorman doctrine (Moorman Manufacturing Co. v. National Tank Co. (1982), 91 Ill. 2d 69) governs the cause of action found in section 5 — 201 of the Public Utilities Act (220 ILCS 5/5 — 201 (West 1992)). The dispositive issue raised in the present appeal is whether the cause of action authorized by section 5 — 201 of the Act must trump the limitation on liability appearing in Bell’s tariff. For the reasons stated below, I believe that an assessment of the tariff, of judicial and administrative precedent, and of the policies that come into play in the legislatively prescribed scheme for setting utility rates compels the conclusion that the liability limitation should be given effect. Accordingly, the present plaintiffs may not recover damages beyond those expressly allowed by the tariff. Setting utility rates is a legislative function, and. in Illinois the Commerce Commission is the body to which the General Assembly has delegated this responsibility. (People ex rel. Hartigan v. Illinois Commerce Comm’n (1987), 117 Ill. 2d 120, 142; Illinois Bell Telephone Co. v. Illinois Commerce Comm’n (1973), 55 Ill. 2d 461, 469-70, quoting Produce Terminal Corp. v. Illinois Commerce Comm’n (1953), 414 Ill. 582, 589; 220 ILCS 5/4 — 101 (West 1992).) Like other regulated utilities, telecommunications carriers are required by statute to file tariffs with the Illinois Commerce Commission. (220 ILCS 5/13 — 01 (West 1992).) For telecommunications carriers, the proposed tariff must describe "the nature of the service, applicable rates and other charges, [and] terms and conditions of service,” among other things. (220 ILCS 5/13 — 501 (West 1992).) The provisions of a tariff may be challenged by interested parties or by the Commerce Commission on its own initiative; unless a provision is suspended by the Commission pending a hearing and decision on a challenge, the provision generally goes into effect 45 days after the tariff is filed with the Commission. 220 ILCS 5/9 — 201(b) (West 1992). An effective tariff has the force of law (Illinois Central Gulf R.R. Co. v. Sankey Brothers, Inc. (1978), 67 Ill. App. 3d 435, 439, aff’d (1979), 78 Ill. 2d 56), and it provides the source for, and determines the nature and extent of, a public utility’s service obligations to customers (J. Meyer & Co. v. Illinois Bell Telephone Co. (1980), 88 Ill. App. 3d 53, 55; Sarelas v. Illinois Bell Telephone Co. (1963), 42 Ill. App. 2d 372, 374-75; Illinois Bell Telephone Co. v. Miner (1956), 11 Ill. App. 2d 44, 58). A company may not deviate from the terms of its tariff and must charge its customers the rates specified in the tariff. Since 1936, each of Bell’s successive tariffs has contained a provision limiting the company’s liability "for damages arising out of mistakes, omissions, interruptions, delays, errors or defects in transmission” to "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.” The terms of this liability limitation have remained virtually unchanged over time. Both the appellate court and the Commerce Commission have upheld the liability limitation in Bell’s tariff against claims by customers for damages allegedly sustained as a result of disruptions or other errors or malfunctions in telephone service. 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; Menco Corp. v. Illinois Bell Telephone Co. (Illinois Commerce Commission Oct. 17, 1984), No. 84 — 0277. A number of rationales support the enforcement of liability limitations in public utility tariffs. (See Note, Limitation of Liability for Interruption of Service for Regulated Telephone Companies: An Outmoded Protection?, 1993 U. Ill. L. Rev. 629, 639-43.) In the main, these reflect the status of public utilities as regulated monopolies whose operations are subject to extensive restrictions, the requirements of uniform, nondiscriminatory rates, and the goal of universal service, achieved through the preservation of utility prices that virtually all customers can afford. See Western Union Telegraph Co. v. Esteve Brothers & Co. (1921), 256 U.S. 566, 572-73, 65 L. Ed. 1094, 1098, 41 S. Ct. 584, 587; Western Union Telegraph Co. v. Priester (1928), 276 U.S. 252, 259-60, 72 L. Ed. 555, 565, 48 S. Ct. 234, 236; Waters v. Pacific Telephone Co. (1974), 12 Cal. 3d 1, 7-10, 523 P.2d 1161, 1164-66, 114 Cal. Rptr. 753, 756-58; Professional Answering Service, Inc. v. Chesapeake & Potomac Telephone Co. (D.C. App. 1989), 565 A.2d 55, 64-65; J. Meyer & Co. v. Illinois Bell Telephone Co. (1980), 88 Ill. App. 3d 53, 57. The concerns that justify the enforcement of liability limitations are present here. The provisions of Bell’s tariff reflect a balancing of Bell’s service obligations to its diverse customer base and of the interest of customers in the continuation of affordable telephone services. The General Assembly has found that "universally available and widely affordable telecommunications services are essential to the health, welfare and prosperity of all Illinois citizens” (220 ILCS 5/13 — 102(a) (West 1992)) and, further, that "protection of the public interest requires continued regulation of telecommunications carriers and services for the foreseeable future” (220 ILCS 5/13 — 102(d) (West 1992)). In accordance with these findings, the legislature has declared as the policy of the State that "telecommunications services should be available to all Illinois citizens at just, reasonable and affordable rates and that such services should be provided as widely and economically as possible in sufficient variety, quality, quantity and reliability to satisfy the public interest.” 220 ILCS 5/13 — 103(a) (West 1992); see also 220 ILCS 5/1 — 102 (West 1992) (finding that the public interest requires "the provision of adequate, efficient, reliable, environmentally safe and least-cost public utility services”). The liability that the plaintiffs seek to impose on Bell is virtually unlimited, and Bell’s entire customer base would ultimately bear that cost. Under existing rate of return regulation, damages awarded in circumstances such as these would find themselves translated into higher tariffs: Bell would recover its costs of compensating affected customers through the rates it charges all its customers. (See Bulbman, Inc. v. Nevada Bell (1992), 108 Nev. 105, 108-09, 825 P.2d 588, 590-91.) Giving effect to Bell’s liability limitation does not mean, however, that customers can never be made whole for disruptions in telephone service. Corporate users that wish to be protected against the risk of service outages may obtain business interruption insurance to compensate them for these losses. Notably, the cost of bearing the risk of loss posed by service disruptions is not a matter that can be varied by-individual contract. Illinois Bell is required to make its services available to all; regulated rates are not negotiable, and Bell may not charge different customers different rates for the same service. (220 ILCS 5/8 — 101 (West 1992).) Allowing the plaintiffs recovery here, without giving effect to the liability limitation in Bell’s tariff, would turn the regulatory process on its head, granting telephone customers the advantage of the low rates obtained through the assurance to Illinois Bell that it will incur no liability for service disruptions, without enforcing the customers’ corresponding duty to insure themselves against that loss, if they seek protection of that type. See Southwestern Sugar & Molasses Co. v. River Terminals Corp. (1959), 360 U.S. 411, 418, 3 L. Ed. 2d 1334, 1341, 79 S. Ct. 1210, 1215. For these reasons, section 5 — 201 of the Public Utilities Act must not be read in isolation, but must instead be considered in the context of the entire legislative scheme of which it forms a part. Thus, rather than find an irreconcilable conflict between the liability limitation in Illinois Bell’s tariff and the statutory cause of action recognized in section 5 — 201, as the plaintiffs urge us to do, we should attempt to reconcile the two provisions. Accordingly, I would limit recovery under section 5 — 201 "to those situations in which an award of damages would not hinder or frustrate the commission’s declared supervisory and regulatory policies,” as the Supreme Court of California has recognized in a similar context. Waters v. Pacific Telephone Co. (1974), 12 Cal. 3d 1, 5, 523 P.2d 1161, 1162, 114 Cal. Rptr. 753, 754. To say that the liability limitation in the tariff means nothing because the statute permits recovery "for all loss, damages or injury” ignores the role of the tariff in the statutory scheme. The legislature has expressed a strong public policy in favor of maintaining utility rates at reasonable levels, and the regulatory process is designed to ensure the continued availability of telephone services at prices affordable to all. The liability exclusion found in Illinois Bell’s tariff plays an important part in keeping rates low; if Bell is to bear the risk of liability for damages of the type sought here, then it will have to charge all its customers higher rates for the services it provides. We are not writing on a blank slate. As I have noted, liability limitations like the one at issue here have been in force for more than half a century, and it seems self-evident that Bell would have charged higher rates for telephone service if the tariffs had not contained these provisions. Moreover, the appellate court and the Commerce Commission have both given effect to Bell’s liability limitations, rejecting customers’ claims for damages beyond those expressly authorized by its tariffs. (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; Menco Corp. v. Illinois Bell Telephone Co. (Illinois Commerce Commission Oct. 17, 1984), No. 84 — 0277.) Under well-established principles of statutory construction, the interpretation of a statute by the administrative agency charged with its enforcement is entitled to deference (Blum v. Bacon (1982), 457 U.S. 132, 141, 72 L. Ed. 2d 728, 736, 102 S. Ct. 2355, 2361; City of Decatur v. American Federation of State, County, & Municipal Employees, Local 268 (1988), 122 Ill. 2d 353, 361), and the Commission’s decision giving effect to Bell’s liability limitation must be accorded appropriate weight. Notably, too, the legislature had the benefit of these judicial and administrative decisions when it revised and recodified the provisions of the predecessor to the Public Utilities Act, effective January 1, 1986. At that time, the legislature made no change in the language of what was formerly section 73 of "An Act concerning public utilities” (Ill. Rev. Stat. 1983, ch. lll2/3, par. 77) and recodified the provision as section 5 — 201 of the Public Utilities Act (Ill. Rev. Stat. 1985, ch. lll2/3, par. 5 — 201). Apparently the legislature found no inconsistency between that provision and the judicial and administrative interpretations given separately to the liability limitations in Bell’s tariffs. The continuation of the text of section 73 in the face of the decisions of the appellate court and Commerce Commission is evidence of the legislature’s acquiescence in those rulings. See Union Electric Co. v. Illinois Commerce Comm’n (1979), 77 Ill. 2d 364, 380-81; Joint Committee on Public Utility Regulations (April 1984), at 4 ("[Cjhanges made for the purpose of this reorganization should not have the effect of amending the policies of the present Act or detracting in any way from applicable administrative or judicial interpretations”). Changes are, of course, coming to the world of telecommunications: technological advances, increased competition at every level, different models of ratemaking and regulation. (See, e.g., 220 ILCS 5/13 — 506.1 (authorizing Commerce Commission to adopt alternative forms of regulation for telecommunications carriers); 13 — 509 (allowing telecommunications carriers providing competitive services to negotiate with customers over terms or rates of service without regard to tariff provisions) (West 1992).) The traditional justifications for enforcing liability limitations such as the one at issue here may lose strength as these changes occur. (See Note, Limitation of Liability for Interruption of Service for Regulated Telephone Companies: An Outmoded Protection?, 1993 U. Ill. L. Rev. 629, 644-47.) Under the law controlling this case, however, the limitation on liability contained in Bell’s filed tariff is an important element in the setting of its rates. As Bell observes, appropriate rates cannot be determined without taking into account the utility’s potential liability, and Bell’s regulated rates rest in part on the tariffs liability limitation. To ignore that provision, as the plaintiffs suggest, would frustrate the legislative scheme applicable here. In sum, I believe that Bell’s tariff precludes recovery by the plaintiffs, and I concur in the judgment of the court. Given this conclusion, we have no need to consider in this case the independent question whether this court’s decision in Moorman Manufacturing Co. v. National Tank Co. (1982), 91 Ill. 2d 69, applies to the cause of action authorized by section 5 — 201 of the Public Utilities Act.