PA Supreme Court Upholds Narrow Application of the Service Point Doctrine to Impose Duty to Warn of Danger on Customer Premises Where Utility Has Actual or Constructive Knowledge of Danger

In a 4-2 decision,[1] the Pennsylvania Supreme Court upheld a Superior Court decision overturning the trial court and denying Duquesne Light summary judgment on the issue of whether a utility has a duty to warn a customer of potential danger on the customer’s side of the service point where the utility has taken affirmative action to restore service and has actual or constructive knowledge of such danger.  Alderwoods, Inc. v. Duquesne Light Co., No. 12 WAP 2013 (Pa. December 15, 2014).  The case arose from a fire caused by an electrical panel in the basement of Alderwoods’ funeral home after Duquesne restored service to the premises by making substantial repairs to a utility pole downed by a car crash outside the funeral home.   Slip op. at 2. 

Under Pennsylvania law, a utility’s maintenance and inspection duties are divided at the service point – a utility “does not have a freestanding duty to inspect customer-owned electrical equipment and services” on the customer’s premises.  Slip op at 17.  However, the Court framed the issue as imposing a duty to “warn[ ] a customer proximate to downed lines prior to restoring power after an outage, where the utility has actual or constructive notice of a dangerous condition within the customer’s premises.”  Slip op. at 17-18.  The Court pointed out that Duquesne focused solely on opposing the Superior Court’s imposition of a duty to inspect, and that Duquesne failed to argue against a duty to warn.  Slip op. at 18-19.

Amicus Public Utility Commission (PUC), like Duquesne, argued against imposing on a utility a duty to inspect customer equipment after outages, likewise failing to address the Superior Court’s duty to warn holding.  The Court marginalized the PUC’s policy position that imposition of a duty to inspect would be cost prohibitive, would cause delays in restoration of service and is best left to the PUC’s regulatory authority, see slip op. at 14-15, focusing on the “more modest avenue” of some form of warning as a “reasonable effort[] to avert harm prior to restoring power.”  Slip op. at 17-18, 20.  The Court reasoned that a policy decision to completely insulate a public utility from the common law duty to warn is best left to legislature.  Slip op. at 20-21.

The Court’s decision upholding summary judgment entails a remand to the trial court for Alderwoods to pursue its claim that Duquesne in fact had actual or constructive knowledge of the danger on Alderwoods property and failed to warn Alderwoods of potential danger resulting from Duquesne’s restoration of service.