The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-06-21
COMPANIES CAN'T CUT OFV GAS
~ IrpFLI tfe ~ IsIOS mr. ~,
NINA ~ DNIs ~ fHN
ths ~ = eu' Iau n IN F1rer I, r'n Necisfed
aeeus'HHtiausL Sat ItH'Irr' iaHa'''
M o'ttrlru ami Patterson fuss'res
VrI sushuu snd IIVtGb'un tissen,

WIZ aVuHfW WV V"NH"'"H VNs'"'
In ,vo ,lsrisldna hsndri duwn yesterday
us ,rreila,e iHvi-icn ~ m" S'tffesn~
Orr,. -,aud,ns ihfrr to two, drclaf~l
mat eas rnnsuincrs afe rntiti~I ~ lnIunc.
,urs restraining the Consolidated tRs
, tntsny from in,cr frrira With their supply
n go ~ lcng ~ they tender mynen, At
O., enis n tho,iaanh. a. nS~i hy the Issis-
.'urc and that ~ " cont liw Ia In force
until dcrlared ]uhcon-ittu ut ionA atcr u trial
ON 80 merits
inc deoisions affirm In onr ca~s tho
Nrlon ~ Supreme Court Justice leven-
'ri'' In granting an injunction 20 Dr, A II.
Cros-lnnn. a consumer and reverse Justice
lcyontritt'- prior action in refusing such
an Injunction while the matter was pending
lefore Justice LacoInbe In the United States
Circuit Court Tho injunction. 40 refused.
j. now granted TO Jacob Richmnn. a lunch
room proprietor at isl Sixth avenue.
In the Ricihnan case Justice LaughlIn
has written an exhaustive opinion covering
twenty-four typewritten pages. Presiding
Justice O'Brien concurs, az does Justice
Patterson, but Justice O'Brien has writ
ten a short separate opinion. Justices
Mclaughlin and Houghton both dissent,
writing separate opinions. Justice Laugh
lin says:
The defendant is exercising public fran
chiseS conferred by the people OF the State
through their Legislature. and ia enjoying
special privileges OF using the public streets
to serve the public, but for private gain.
In thus exercising public franchises and spe-
cal privile ges 1t owes a duty to the public
TO furnish gas to its consumers at reasonable
rates. which the Legislature may regulate
and the courts may enforce. IL is COM
retent for tho Legislature to regulate the
lrice that the defendant may charge con-
sumsrs. provided It does not require 1t 10
supply gas at a rate that will not admit OF
a reasonable profit TO the stockholders upon
the actual value Of the plant and property
OF the company.
Justice Laughlin nays that if the rate SO
fixed is unreasonable the courts may be
appealed to, as has been done in the present
case. He comments, however:
Both the Legislature and the State Commits
sion Of Gas and Electricity appear to have
acted with due elaboration. and after care
full Investigation OF the essential facts the
gas company shows that the actual cost to the
company Of supplying gas to Its consumers
during the present year viii be about 81 cents
per thousand cubic feet. and that it Is es-
sential for 1t to reserve at least three cents
per thousand cubic feet for maintenance Of
Its plant, making a total cost TO the company
Of 70 cents per Thousand cubic feet. and leav-
ing 10 cents per thousand as profit, which will
make a probable profit for the year OF 81 $780,
600. which. however. upon Its theory OF the
case. will only admit of a profit OF ~ per
cent. to It's stockholders. The Commission OF
Gas and Electricity reached the conclusion. as
shown by their order, that the 50 cent rate
would admit OF a profit TO the stockholders of
per cent.
The controversy thus arising, says JUS
tee Laughlin. can only be determined by
an examination into the merits OF the case,
so that the value Of the %company's property
upon which dividends should be based
may be definitely a~scertained. Meanwhile,
he says, there is no ground for assuming
that the law is unconstitutional. Until a
judicial determination upon a final hearing
is had il is a general rule Of law that a stat
ute shall be presumed to be valid, and
although its enforcement may be tenn
porarily enjoined its operation cannot be
suspended"
THE practical effect Of this rule" says
Justice Laughlin, ais that the legal rate
WHICH COIlSullltie dlo tiiicu W pay ohN
uron payment Of which they are entitled
to a continuance OF the service, is that pre-
tcribed by the last enactment Of the Legis-
lature, pending the decision of the question
rs to the constihltionality Of the statute.
Therefore the company should not be per-
mitted to coeroe the consumers into pay
Ing the old rate
The company may demand payment
=. .I--I -. -al z,,o b An f1rna o,tnh do
mands, taking the risk OF the penalties
provided by the law. But in the present
case, where the plaintiff stands upon his
rights, and has rendered payment at the
legal rate, 'it is the duty Of the defendant
by the express terms Of the statute to con-
tinue supplying the plaintiff with gas, and
this is a duty which may be enforced by
mandamus.'
Justice Laughlin then examines the pro-
ceedings before the Federal court, to which
no consumer is a party. Such proceed
ings, be says, cannot affect the rights OF the
Plaintiff Richman, Notwithstanding the
many ingenious arguments cf counsel icr
ne gas company to the contrary.
1t may be that under the prayer for relief
the Federal court may by supplemental
bill make private consumers Of gas parties
10 the suit, but this court having first OBJ
tanned Jurisdiction OF the controversy 30 far
as 1t relates to the rights OF the plaintiff.
It will not be competent for the F ederal Court
to take Jurisdiction over the plaintiff In such
manner az to interfere with any order or
decision that may be made by this court.
Tho decisions OF the respective, courts
will be binding only upon the parties to the
respective suits. If our court and tho Circuit
Court OF the United States should not take
the same view OF the law. the Supreme court
OF the United States. II appealed to. will
ultimately reconcile the decisions.
The dissenting Justices hold that, the
Federal court having acquired jurisdiction
in the gas cases, the general rule Of comfy
should operate to prevent interference
by the State courts, even though, as here,
the plaintiff is not directly affected by the
Federal proceedings, Justice Mclaughlin
adds that on the merits OF the case the
injunction should be refused. He says:
1t Is a somewhat alarming proposition
that a Legislative body can. simply by its
own fat, arbitrarily fix the price at which
the owner Of a product must sell it. and It is
epnally 40 that a court will refuse to the
owner Of the product the right to sell II at the
price at which he had heretofore sold IL