Telephone Company Held Liable for Failure to Provide Reliable, Timely Information About Location of Underground Lines

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Plote, Inc. contracted with the Illinois Department of Transportation to make improvements to a road. Before the project and at utility meetings during the project, Illinois Bell Telephone Co. was asked to provide information about the location of its underground facilities. Plote needed this information so that it could timely execute its work and so that it would not damage existing facilities. Because Illinois Bell provided incomplete and inaccurate information about the location of its underground facilities, the project was delayed by seven months.

Plote sued Illinois Bell under a variety of legal theories for damages resulting from the delay. The trial court dismissed all of Plote's causes of action. The Appellate Court of Illinois reversed as to one of them. Illinois Bell Telephone Co. v. Plote, Inc., 334 Ill.App.3d 796, 778 N.E.2d 1203 (2002).

Plote argued that Illinois Bell was liable for negligently failing to provide information about the location of its underground facilities. The court found that there was no common law duty to provide this information to Plote and sustained dismissal of the cause of action.

However, Illinois' Underground Utility Facilities Damage Prevention Act requires owners of underground facilities, upon notice, to mark the approximate locations of their facilities within 48 hours.

Illinois Bell sought to shield itself from this duty by invoking the economic loss rule, which bars recovery in tort for damages not involving personal injury or physical damage to property. There is an exception to the economic loss rule for information providers. It allows recovery in tort for economic losses when the damages "are a proximate result of a negligent misrepresentation by a defendant in the business of supplying information for the guidance of others in their business transactions."

Plote argued that determination of whether Bell was an information provider should be made by looking to the context of the specific transaction involved and not on the basis of Illinois Bell's general business. Bell argued that its primary business is not supplying information, so it should not come under the information provider exception.

The court held that under the underground utility act, Illinois Bell's sole function was to provide information to Plote regarding the location of its underground facilities. Accordingly, the Appellate Court held that Plote had stated a claim against Illinois Bell based on the underground utility act. The court held that the statute imposed an independent duty on the utility to provide information and that, in the context of that statute, the utility was in the business of supplying information. Accordingly, the factual situation fell within the information-provider exception. While Illinois Bell's general business might be providing telephone service, it is the nature of the transaction at issue in the specific case on an ad hoc basis that is determinative.

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