Evening star. [volume] (Washington, D.C.) 1854-1972, 1901-05-22
The Telephone Decision.

The decision of the District Court of APP
pcaIs in the telephone case. reproduced in
fuIl in today's Star. is plain-reading doc
urnent capable of entire absorption by the
non-leGdl mind. It's meaning is unmistak
able and is a cause of qualification to the
citizens of the District who either tel
cphoue users or hope to become such under
a modification of the rate scale For this
decision advances the plea of the telephone
user another stage toward favorable
Spouse and puts the burden of appeal and
proof upon the monopoly corporation. 1t
is assured that the case will now be carried
10y the telephone company to the court of
last resort. which alone stands between the
corporation and enforcement of the rates
prescribed by the act of 1SIs.
The Court of Appeals holds that Congress
has the right to dictate to the Chesapeake
and Potomac Telephone Company the terms
upon which ii may remain and do business
in the District. without regard to the char
acter of these terms Inasmuch as the
company holds no charter from Congress
and enjoys in this District only the rights
of tenant at will, it must yield to the
regulations prescribed by Congress or va
cate the field. The corporation being here
without invitation or express permission.
it holds no contract with the Iaw-making
power. II displeaSed with the latter'S
action. il may leave. just as it would be
Obliged to leave if Congress directly de-
creed. and in leaving it could take with it
only lis movable property. Furthermore
Congress has the right at any time to grant
franchise to some other company with
the right to take and use. for d proper
compensation the cables and poles of the
existing corporation.
Although the Court of Appeals reverses
the action of the court below on the ground
that the corporation must either accept the
rates prescribed. whatever they may be- or
vacat" the premises it passes to a con-
sideration of the question of reasonabeness
"f the rates. and there finds material for
deep study, the net result of which is an
opinion that the rates are not confiscatory
and unconstitutional 1t holds that proof
IT the coniiscatory nature of the rates must
come. beyond a reasonable doubt from the
company, and cites decision of the United
states Supreme Court to this effect. 1t
anaiyzes the statistics sufficiently to indi-
cate that 1t is not impressed with the arith-
metlc of the company. 1t distinctly de-
cldres that improvements of plant should
be charged to the construction account ard
not To that of maintenance, and that the 80
per cent of expenses charged against the
District of Columbia by the Chesapeake
and Potomac Company is unfairly large. 1t
AYERS also that the salary account is out of
proportion in comparison with other cities
In conclusion upon this point the court says
that its examination of the evidence did not
satisfy it that the necessary effect of the
enforcement of the rate will be destructive
OF the defendants rights of property
With an applicant for direct charter
rights in the District knocking at the doors
of Congress willing to furnish modern teIc-
phOny for rate even below that pre-
scribed by Congress for the present COM
pdny. it will be seen that this decision re-
gdrdlng the status OF the latter is of the
utmost Importance, even beyond the i'm
medlt e effect upon the rate question of the
general action of reversal The Court of
Appeals decision is in line with the T.ub!ic
and common-sense view of what the law
ought to be.
As The Star recently said:
The question, however is not what this
telephone company can afford to furnish
the unlimited supply for, but what il can
lie supplied for by anybody. 1t is claimed
that good telephone service In a CITY of
large size can be rendered at a cost of
less than thirty dollars. and figures are
given NuCluding those of Toronto. Canada
t. sustain this contention. The Chesapeake
and Potomac Company has no vested
rights in the District. charter. no fran
ChlSe. II Is mere merely by SuffranCe. 1t
Is not in position to exact rates which ac-
cord only with its own ideas of profit. The
rules of business and equity should first
apply To force the rendering of the service.
at rate which represents the present
trend Of reasonable prices in other cities
tn" actual cost Of installation and mainte-
nance and the fair profit which is to be
granted to every private enterprise serving
the public But in fixing this rate and the
prospective rate of Profit the company
should not he permitted to cite its own rec
oris. arranged by its own experts TO swell
the cost Of maintenance or 10 obscure the
actual cost of installation. 1t should not
De permitted TO charge against the public
the interest on watered stock or the capt.
faltZsd extravaganza OF the past: or the
heavy royalties paid by the corporation in
one capacity 10 itself in another. On the
basis ~ what it costs today to operate a
telephone service with unlimited Use Offered
t. the largest subscribers. it should be
compelled to reduce its rates to the point
az reason or else step aside for another
company. pledged and bonded to render
satisfactory service for rates far below
those charged by the present MONOPOLY
Or Pdrkhurst points out that the abSo-
Lutte closing Of New York saloons on Sun
day Is likely 10 drive the votes Of the for