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PENNSYLVANIA POWER & LIGHT COMPANY v. GULF OIL CORPORATION (09/28/79)

filed: September 28, 1979.

PENNSYLVANIA POWER & LIGHT COMPANY,
v.
GULF OIL CORPORATION, SCALLOP NUCLEAR INC. AND GENERAL ATOMIC COMPANY, APPELLANTS



No. 3051 October Term, 1978, Appeal From Paragraph 5 of the Order Dated June 21, 1978 of the Court of Common Pleas of Lehigh County, January Term, 1975, No. 453.

COUNSEL

Gordon W. Gerber, Philadelphia, for appellants.

K. Robert Conrad, Philadelphia, for appellee.

Cercone, President Judge, and Price, Van der Voort, Spaeth, Hester and Wieand, JJ. Van der Voort, J., concurs in the result. Wieand, J., did not participate in the consideration or decision in this case.

Author: Spaeth

[ 270 Pa. Super. Page 520]

On November 6, 1974, Pennsylvania Power & Light Company (PP&L) started the present action in assumpsit against General Atomic Company (GAC) and GAC's partners, Gulf Oil Corporation and Scallop Nuclear, Inc. The complaint was filed in Lehigh County and alleged that in the fall of 1973, PP&L had entered into a contract with Gulf United Nuclear Fuel Corporation, a predecessor of GAC, for the delivery of uranium and fuel fabrication devices, and for various services, to PP&L's nuclear power plants, and that in 1974 GAC had repudiated this contract, causing damages in

[ 270 Pa. Super. Page 521]

    excess of $10,000. PP&L requested a trial by jury. GAC filed an answer to the complaint, in which it denied the existence of any contract, raised other defenses, and pleaded various counterclaims. GAC also filed an application for change of venue, alleging, inter alia,*fn1 that it could not obtain a fair trial because a large number of the inhabitants of Lehigh county were customers of PP&L and therefore had an interest in the case adverse to GAC. On March 30, 1976, the lower court denied this application. PP&L subsequently answered interrogatories propounded by GAC, in which it estimated its damages to be from $88,642,525.60 to $114,471,031.60 or more.*fn2 On December 15, 1977, GAC petitioned the lower court to reconsider its order of March 30, 1976, denying GAC's application for change of venue.*fn3 On January 4, 1978, PP&L filed an answer to GAC's petition for reconsideration,*fn4 and after depositions*fn5 and oral argument, the

[ 270 Pa. Super. Page 522]

    lower court, by order of June 21, 1978, denied the petition for reconsideration. On October 4, 1978, at GAC's request, the lower court certified its order of June 21 for interlocutory appeal,*fn6 and on December 27, 1978, this court permitted the appeal.*fn7

In support of its argument that it cannot obtain a fair trial in Lehigh County, GAC cites the deposition testimony

[ 270 Pa. Super. Page 523]

    of George Vanderslice, PP&L's Vice President and Comptroller, and William O'Hara, a former Commissioner of the Pennsylvania Public Utility Commission (PUC). Both men testified that the PUC would have to rule on how a recovery of damages as large as the one sought by PP&L should be treated. They testified that they did not know how the PUC would in fact rule. Mr. Vanderslice testified, however, that it was doubtful that the PUC would permit PP&L to distribute any of the damages to its shareholders, and he admitted that the tendency of any PUC ruling would be to reduce the electric bills to PP&L's customers. Mr. O'Hara also testified that the damages would not go to the shareholders. He suggested three different ways in which the PUC might rule: either (1) reduce the rate base of PP&L's Susquehanna nuclear plant; or (2) allow a reimbursement under the fuel adjustment clause; or (3) permit PP&L to retain the damages recovered for additional capital investments. All of these possible rulings would result in lower electric bills to PP&L customers, but this benefit, according to Mr. O'Hara, could be spread over a period of several years.*fn8 Based upon this testimony, and using population and

[ 270 Pa. Super. Page 524]

PP&L customer figures, GAC calculates that 98.5% of the residents of Lehigh County are customers of PP&L, and that each could receive a benefit of as much as $289.86.*fn9

Citing the deposition testimony of Dr. Burton Cohen, a witness expert in psychiatry, GAC argues that the possibility of such a benefit would color the jurors' perception of the evidence and prejudice them against GAC.*fn10

PP&L disputes GAC's argument on several grounds. It disagrees with GAC's calculation that 98.5% of the residents of Lehigh County are customers of PP&L. PP&L argues instead that only 44.9% of the residents are its customers. PP&L also argues that the possibility of any customer receiving any benefit is speculative, as no one can foresee the future actions of the PUC, and that even if the PUC were to rule in such a way that any recovery would benefit

[ 270 Pa. Super. Page 525]

    the customers and not the shareholders of PP&L, the immediate impact upon any individual juror would be negligible, as any such benefit would likely be spread over a period of several years. PP&L also argues that the jury could not be prejudiced against GAC and in favor of PP&L as there is no evidence that the people of Lehigh County believe*fn11 that a recovery for PP&L would represent a benefit to PP&L's customers.*fn12

[ 270 Pa. Super. Page 526]

The issue may be framed in two arguments: (1) that Pennsylvania law entitles GAC to a change of venue;*fn13 and (2) that by forcing it to stand trial before a Lehigh County jury, the lower court has violated GAC's right to due process of law as guaranteed by the fourteenth amendment of the United States Constitution.

1

The Pennsylvania Constitution provides that "[t]he power to change venue in civil and criminal cases shall be vested in the courts, to be exercised in such manner as shall be provided by law." Pa.Const. art. 3, ยง 23. This provision did not affect the Supreme Court's inherent power to grant a change of venue, but gave the legislature the right, by statute, to confer such power upon the trial courts. Apex Hosiery Co. v. Philadelphia County, 331 Pa. 177, 200 A. 598 (1938); Commonwealth v. Sacarakis, 196 Pa. Super. 455, 175 A.2d 127 (1961).*fn14 The statute by ...


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