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Duke Energy Indiana, LLC v. Avon

Court of Appeals of Indiana

August 24, 2017

Duke Energy Indiana, LLC, Appellant,
v.
Town of Avon, Indiana, Appellee.

         Appeal from the Indiana Utility Regulatory Commission The Honorable David E. Ziegner, Presiding Commissioner The Honorable Aaron A. Schmoll, Sr., Administrative Law Judge Cause No. 44804

          ATTORNEYS FOR APPELLANT John D. Papageorge Steven C. Shockley Taft Stettinius & Hollister LLP Indianapolis, Indiana Kelley A. Karn Casey M. Holsapple Duke Energy Business Services LLC Plainfield, Indiana

          ATTORNEYS FOR AMICUS CURIAE INDIANA ENERGY ASSOCIATION Robert L. Hartley Maggie L. Smith Frost Brown Todd LLC Indianapolis, Indiana

          ATTORNEY FOR AMICUS CURIAE - INDIANA CHAPTER NATIONAL ASSOCIATION OF WATER COMPANIES, INC. Nicholas K. Kile Barnes & Thornburg LLP Indianapolis, Indiana

          ATTORNEYS FOR APPELLEE Daniel L. Taylor J. Kent Minnette Taylor, Chadd, Minnette, Schneider & Clutter, P.C. Crawfordsville, Indiana

          Najam, Judge.

         Statement of the Case

         [¶1] In June of 2016, Duke Energy Indiana, LLC ("Duke") filed a complaint against the Town of Avon ("Avon") with the Indiana Utility Regulatory Commission ("IURC"). In its complaint, Duke disputed Avon's authority to order Duke to remove, at Duke's own cost, utility poles, power lines, and other equipment located either on land owned by Avon or in Avon's rights-of-way. However, prior to Duke filing its complaint with the IURC, Avon had filed a complaint for declaratory judgment against Duke in the Hendricks Circuit Court on the same questions. The IURC dismissed Duke's complaint out of deference to the jurisdiction of the Hendricks Circuit Court. Duke appeals that dismissal and raises two issues for our review, [1] but we consider only the following dispositive issue: whether Indiana law establishes exclusive jurisdiction in the IURC over the subject matter of the parties' complaints. We hold that Indiana law establishes that exclusive jurisdiction. Accordingly, we reverse the IURC's dismissal of Duke's complaint and remand for further proceedings.

         Facts and Procedural History

         [¶2] Duke is an Indiana company that distributes, furnishes, and sells retail electric service to more than 800, 000 Hoosiers. As such, Duke is an "electricity supplier" and a "public utility" under Indiana law. Appellant's App. Vol. II. at 7. In 2014, Avon informed Duke that Avon intended to construct road and trail improvements near the intersection of County Road 625 East and U.S. Highway 36 in Hendricks County. Avon's project required Duke to relocate certain utility poles, power lines, and other equipment (collectively referred to as the "facilities") that was owned by Duke but located either on land owned by Avon or in Avon's rights-of-way.

         [¶3] On February 26, 2015, the Avon Town Council passed Ordinance No. 2015-03, enacted as Section 4-9-4-122(E) of the Avon Town Code ("the Ordinance"). The Ordinance shifted the costs of the relocation expenses associated with Duke's facilities and required Duke to pay for that relocation.[2] A violation of the Ordinance would result in a fine of $500 per day.

         [¶4] In February of 2016, Duke informed Avon that Duke would not comply with the Ordinance because, according to Duke, the Ordinance was unreasonable and contrary to Indiana law. As such, on May 23, Avon filed a complaint for declaratory and injunctive relief in the Hendricks Circuit Court against Duke. In its complaint, Avon alleged that Indiana law requires a utility provider that must relocate facilities to accommodate a municipal improvement to do so without reimbursement from the municipality. Accordingly, Avon requested the Hendricks Circuit Court to enter a declaratory judgment that "Indiana law does not require Avon to reimburse Duke for the relocation costs incurred" by Duke for Avon's improvements. Id. at 19. Avon further asked the court to enjoin Duke from refusing to comply with Avon's demands.

         [¶5] Thereafter, on June 24, Duke filed a motion to stay in the Hendricks Circuit Court and a complaint with the IURC. In its complaint, Duke alleged as follows:

4. [Duke's] Argument. Statutory and case law provide that public utilities shall relocate their utility facilities at their own expense only if (a) they are located in the public right-of-way and (b) are in the way of a general road improvement project, e.g., a general widening or modification of the paved surface of the roadway for the benefit of the vehicular traveling public and not for the benefit of an adjoining landowner or another member of the traveling public, e.g., municipal utility facilities, municipal trails, or public utilities, etc. Because this case concerns a "multi-use trail, " it is [Avon's] responsibility to pay for the relocation of [Duke's] facilities . . . .
5. Applicable Statutes and Regulations. The [IURC] has jurisdiction over this matter pursuant to Ind. Code § 8-1-2-101(a)(1). The statute provides that the [IURC] shall set a hearing upon a Complaint by a utility that a municipal ordinance or determination is unreasonable. The statute further states that[, ] if the [IURC] finds the contested ordinance or determination to be unreasonable, such ordinance or determination shall be void. . . .

Id. at 9. Duke thus requested the IURC to find the Ordinance unreasonable and void and to declare that Duke "is not required under Indiana law to relocate its facilities for [Avon's] multi-use trail unless and until [Avon] agrees to reimburse [Duke] for its costs with such relocation . . . ." Id. at 10.

         [¶6] On August 2, two presiding officers with the IURC "decline[d] to set a procedural schedule at this time" because "an action involving the same general subject matter was filed in Hendricks County prior to being filed with the [IURC]." Id. at 27. The officers instead ordered Duke to provide a timely status report to update the IURC on the status of the matter in the Hendricks Circuit Court.

         [¶7] Meanwhile, the Hendricks Circuit Court set a hearing on Duke's motion to stay, but, on August 9, the parties submitted an Agreed Order to the Hendricks Circuit Court, ...


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