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Contracts Keyed to Burton
Northern Indiana Public Service Co. v. Carbon County Coal Co.
Citation:799 F.2d 265
In 1978, Northern Indiana Public Service Company (hereinafter “NIPSCO”) (plaintiff) and Carbon County Coal Company (hereinafter “Carbon Coal”) (defendant) entered into a contract. Under the contract, Carbon County agreed to sell and NIPSCO to buy approximately 1.5 million tons of coal every year for 20 years. In 1983, the price of coal increased and NIPSCO requested permission from the Indiana Public Service Commission (hereinafter “the Commission”) (who regulated NIPSCO’s rates) to increase their fuel rates. The Commission granted the request but required NIPSCO to make a good-faith effort to find ways to lower its rates. NIPSCO did find a cheaper alternative that allowed them to buy electricity at a lower cost than buying coal under its contract with Carbon Coal. NIPSCO decided to stop accepting coal deliveries from Carbon Coal and sought a declaration that it (NIPSCO) was excused from its obligations under the contract.
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