California Public Utilities Code Section 1759 - Interpretation
In San Diego Gas & Electric Co. v. Superior Court (1996) 13 Cal. 4th 893, 920 P.2d 669 (Covalt), the Supreme Court considered whether a claim for damages and related relief brought against a Southern California public utility by homeowners, stemming from fears that nearby electrical high transmission lines exposed them to the threat of cancer, was preempted by California Public Utilities Code Section 1759.
The utility had set up that statute as a jurisdictional defense, arguing that the suit was barred by the PUC's statutory jurisdiction to regulate electrical powerlines.
The trial court overruled a demurrer to the complaint, but the court of appeal reversed. Granting review, the Supreme Court affirmed the appellate ruling ordering the demurrer sustained without leave to amend. (13 Cal. 4th at p. 914.)
In a pellucid statement of the governing rule, the Covalt court built on its prior decision in Waters v. Pacific Telephone Co. (1974) 12 Cal. 3d 1, 114 Cal. Rptr. 753, 523 P.2d 1161.
"Under the Waters rule" the court wrote, "an action for damages against a public utility pursuant to section 2106 is barred by California Public Utilities Code Section 1759 not only when an award of damages would directly contravene a specific order or decision of the commission, i.e., when it would 'reverse, correct, or annul' that order or decision, but also when an award of damages would simply have the effect of undermining a general supervisory or regulatory policy of the commission, i.e., when it would 'hinder' or 'frustrate' or 'interfere with' or 'obstruct' that policy." ( Covalt, supra, 13 Cal. 4th at p. 918.)