The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1902-07-14

seek Otner LOCALITIES
THE NATURAL-GAS QUESTION.
The announcement of the indianapolis
Gas Company that 1T will cease furnishing
natural gas in this city and after Sept.
30 will not surprise any person who believed
the company was sincere in its recent
representations regarding the situation and
its efforts to bring about the introduction
OF meters. Those who insisted that the
company simply making a big bluff
may be surprised at the announcement.
The Journal has thought for some time
past that the introduction of meters was
the only rational thing 10 do in the cir
cumstances, and that if it were not done
the company would assert and test its right
to quit the business. All the material con-
dtions Of the situation have so completely
changed during the last few years, includ-
ing the quantity and pressure Of natural
gas, the distance of transporting and the
cost Of distributing it that it was foolish
to expect that the company would continue
to furnish it at former prices and under
the old wasteful methods II it could possi-
big better itself. The introduction of
meters was one alternative. and that hav-
ing been rejected. there is nothing left
for the company but to quit the business.
From the company's point of view its
ton is consistent and business-like. Cor
porations, like individuals. engage in bust
ness only to make money, and whether the
company mas much or little gas it cannot
be expected to continue disposing of it at
a loss in one market If there is any posi-
bility of doing so at a profit in another.
The directors of the company say it has
already sustained serious financial loss. 1t
may have made money at the beginning
and for a few years but no doubt it has
lost money under the greatly changed con-
diticns referred to. Among the reasons
given by the directors for their decision to
withdraw from business in this city under
existing conditions is the following:
The bondholders of this company TO
whom all its assets Qncluding its natural
gas fields) have been pledged by certain
deed of trust, have threatened and are now
prepared (acting under compete legal adj
vice. to bring an action 10 enjo.n the COM
pany from continuing the business of sup
plying natural gas to such city upon the
ground that IL is a waste of its assets in
violation of its contract obligation with
them and with the trustees of the mort
gage.
If such a suit were brought the courts
would probably hold that the mortgage
bondholders had first lien on the assets
of the company and that it had no right to
waste such assets and thereby dissipate the
bondholders' security by continuing to do
business at a loss.
The mayor says suit will be commenced
Immediately to test the companys right to
quit business. Perhaps he owes that much
to those who are still using natural gas and
who are DESTROYS of having it continued at
the old rates and the old wastefuI methods
He claims that the company is under a con-
tract to furnish gas at ordinance rates as
long as it has gas for sale, without refer
ence to the question of profit or loss, and
that in the absence of any provision that
1t may quit the business at pleasure 1t has
no right to do so. This depends on whether
the relation between the city and the COM
pany is that of a contract. That is a close
question. and one on which lawyers may
/ differ. The original ordinance authorized
any corporation or company to pipe the
streets and alleys of the city for the pur-
pose OF supplying the people with natural
gas, contained provisions for the protec-
/ ton of the streets, prescribed the rates at
| which gas should be furnished and pro-
vided that any corporation or company
| availing itself of the rights under the ordi-
nance shall. as condition to the exercise
| of the franchise herein granted, furnish
natural gas to consumers for and at sched-
ule of prices following" No time was men
toned for the duration or existence of the
! franchise. Acceptance of its conditions
/ bound the company to furnish gas at the
prescribed rates as long as it should con-
| tinue in the business, but there was moth
/ ing in the ordinance TO indicate that il
might not end its obligation by withdraw
ing its acceptance of the ordinance In its
notice OF quitting the company says that
| on Sept. 50 1--WE will surrender to the CITY
of indianapolis our rights to use the streets
| of the city for the distribution of natural
/ gas" This phraseology shows that the
companys lawyers regard the use of the
streets for the purpose named as a fran
chise which was paid for during the period
OF their use by the company's furnishing
/ gas at ordinance rates. and which. as il
was voluntarily accepted by the company.
could be voluntarily surrendered at its
pleasure. Whether this is a correct view or
not will be for the courts to decide.
II