Evening star. [volume] (Washington, D.C.) 1854-1972, 1901-05-22
TELEPHONE DECISION
Text Of Opinion Handed Down by
Court Of Appeals.
LOWER COURT JUDGMENT REVERSED
Constitutional!ty Of Act Fixing
Rate for Service Upheld.
THE CAUSE REM AN D ED

The text of the important opinion Of the
Court Of Appeals reversing the Supreme
Court of the District Of Columbia In the
local telephone injunction case and up
holding the constitutionality of the act of
Congress limiting the rate to be charged
for telephone service in the District, an alb
stract of the opinion having been pub
lished yesterday in The Star. Is as follows:
j. Forrest Manning and Harry e. Rup
precht, trading as J. Forrest Manning &
Co, appellants, agt. the Chesapeake and
Potomac Telephone Company:
This suit was begun by the appellants in
the Supreme Court of the District Of Co
lumbia to compel the Chesapeake and Pc.
tomac Telephone Company to continue to
furnish them the ordinary service of the
Washington telephone exchange upon pay
ment of the annual rate prescribed in the
act Of Congress of June 80. 1898. This reg
ulation of rates is contained in proyfso
added to an item of the general appropria-
ton bill of that date. and reads as follows:
Provided, That from and after the pas
sage of this act it shall be unlawful for
any person or any telephone company doing
business in the District of Columbia to
charge or receive more than $50 per annum
for the use of a telephone on separate
wire: $40 for each telephone, there being
not more than two on wire: $50 for each
telephone there being not more than three
on a wire. and $23 for each telephone,
there being four or more on the same
wire" GO Stat, 531 53S).
The Only Plant in District.
The Chesapeake and Potomac Telephone
Company, then, now, owned and OPP
Grated the only telephone plant in the Dis
trict of Columbia.
On July l, 1897, plaintiffs entered into a
contract with the defendant. whereby the
latter agreed to furnish them it's improved
appliances, with, special metallic circuit
for use in their business offices, and for
which they promised to pay the sum of
$125 per annum, quarterly, in advance, and
$40 additional per annum for an extra desk
cabinet equipment. BY special provision
the contract was declared to continue from
year to year, subject to termination by
either party after the first year, upon ten
days notice.
Upon the passage Of the aforesaid act
plaintiffs gave notice Of termination of the
contract, and then, ten days later, notified
defendant that they would retain the tefe-
phone equipment at the rate of $50 per an
mum, as provided by law. They also ten
dered payment in advance at said rate.
Defendant declined to accept payment at
said rate on the ground that the same was
less than the cost of service, but offered to
continue at the former contract rate or
else to remove it's telephone equipment
from plaintiffs office and discontinue their
service. Alleging these facts, and renew
ing the tender of payment of the statutory
rate. plaintiffs bill prayed that defendant
be enjoined from removing their telephone
appliances, and from refusing or neglect
ing when requested. to furnish them the
usual telephone connections and service.
Defendants Averment.
The defendants answer averred that its
service could not be maintained at the rate
fixed by the act of Congress without actual
loss and denied the power Of Congress to
compel it to furnish the same for less than
! cost because the effect would be the con-
| fiscation of it's property. The temporary
injunction prayed for was granted August
4, 1893. About fifty like suits were filed by
other subscribers. These were practically
consolidated with this suit in which alone
testimony has been taken, and made to
abide it's result.
A great volume of testimony was taken
| by the parties and the cause came on to
| be heard February 3 1900. The result was
| a final decree Diminishing the bill, from
which this appeal has been duly prose
| cuted.
The first public Of the telephone in
| the city of Washington was begun by Geo.
| c. Maynard late in the year 1873. under a
contract with Gardiner G. Hubbard, trus-
tee, for the agency and use therein of the
| inventions of Alexander Graham Bell
| Maynard was made exclusive agent for the
| rental of the Bell telephones and call bells
which were to be supplied to him. He
was to erect lines, use diligence to bring
| ton to receive a percentage of the rentals
| of instruments. A subsequent agreement
| ratifyng the foregoing and extending II
to certain other inventions controlled by
the Western Union Telegraph Company
was made with Maynard by the Nationa
Bell Telephone Company, which had In the
meantime become the assignee Of the Bel
patents and others. About December 1
1879, Maynard conveyed his plant, rights
etc, to the National Capital Telephone
Company, corporation created under the
laws Of West Virginia.
March 81, 1888, this company entered into
a contract with the American Bell Tele
| phone Company for the use Of it's tele
phones upon an agreed division Of the pro
ceeds of their rentals to subscribers.
| Shortly after this the Chesapeake ant
Potomac Telephone Company was incorpo
rated by the laws of the state of New
York for the purpose Of acquiring the prop
erty and consolidating the business Of tn
National Telephone Company, operating II
the District, and Of the Telephone Elk
, change Company, a corporation of Yves
Virginia. then operating in Maryland. TIL
capital stock of the Chesapeake and Poto
mas Telephone Company was fixed at 50,
$50 600.
On July 80 1888, the National Capita
Telephone Company, in consideration @
$4,000 Of the capital stock of the Chesa
peake and Potomac Telephone Company
! transferred to the latter all of it's plant
I property and rights of every description
\ Acquires Control of Other Company.
At the same time the Chesapeake an
Potomac Telephone Company acquired al
the rights. property, etc, Of the Telephon
Exchange Company in Maryland. The con
J sideration was the delivery Of 81 900 600 O
the capital stock of the assignee. BY tn
! terms Of the agreement of transfer $500 90
of this stock was to be delivered to the Ma
. tional Bell Telephone Company and $3.50
600 to the Telephone Exchange Company
OF this last 100000 was to be passed t
trustees for the use of the Chesapeake an