New-York tribune., 1907-12-22
T.. S. Supreme Court to Pass on In
cIusion of Franchise Talues.

-rbough Judge Hough's opinion rendered Fri
sav gave the victory practically all along the line
:, ,te Consolidated Gas Company in the fight TO
sa+e-roine whether 81 so cents should be the
,egal rate for thousand, cubic feet of in the
1o-orphs of Manhattan and The Bronx and the
rreater part of Brooklyn, 1t is certain that the
r-rt,ed States Supreme Court will be called on TO
e, as arbiter in the third and final bout between
,he contestants The first two-that before the ref
.,aa Mr. Masten and the more recent one before
Judse Hough. in the United States Circuit Court
,ef, the gas company in comparatively fresh condi-
a., b,t the state and city representatives
came and determined TO contest the constitu-
,ionary of law before the court of last resort
Abel E Blackmar. counsel for the Public Ser
vice Commission. was busy yesterday examining
she decision of Judge Hough. He said that IN
,5oubtedy the commission would appeal Regard
.rg the courts opinion the matter of franchises
-sr Elackrnar said that Judge Hough had pointed
out in his opinion that the question Of their in
,,,sion in the valuation of the income earning
,roperty Of corporation had never been consfd-
cred by the Supreme Court.
TO decide that point" said Mr. Backmar. it
ss entirely likely that the commission will act
es pioneer in bringing 1t to the attention Of the
ro1rt 1t Is a fine opportunity TO test it
The decree of the court declaring the Scent gas
law unconstitutional and issuing the injunction
desired by the gas company will probably not be
sled in the United States Circuit Court for sew
eraI days. and until then, Of course. there is no
r,,asfion of appeal. No conference Of the counsel
sor the four defendants in the Consolidateds suit
,ta city Of New York. the Public Service Commits
sion the Attorney General and the District At
soraey OF New York County-was held yesterday
tAs they said long that appeal would be
,aken tc the United States Supreme Court IL the
referee and Judge Hough were to decide against
fher7 il is only question Of time when such
srtion will be taken. The attorneys for the gas
ran1psnv expect that such appeal Will be made
Judge Hough's ruling that the statutes of April,
sss are in contravention of the Fourteenth Amend
,nent enables the contestants to take the case d-
rec1ly 10 the United States Supreme Court Should
the opinion Of Judge Hough be upheld by that
,ou-t .he CITY and the state stand to expend q
,srce sum Of money between them for the htsa-
tson The records of the hearing before Mr.
-fasten are contained in eighteen large volumes
representing an expenditure OF at least 10000. for
which the losing party the suit will have TO pay
eventually. This is only part Of the expense in
CURED already in the litigation
The attorneys for the gas company expressed
themselves yesterday especially pleased with
Judge Hough's finding that the corporation Is en-
,3-lad n = return on its franchises. This WIS the
main contention which they sought TO have up
ield in the courts. The courts acceptance OF the
validity OF the franchises Of the Harlem Gas Lish'
snd the Knickerbocker Gas companies, which cover
he xr;oe territory of the Consolidated, also gave
satisfaction. although the gas company contends
that il has still more valuable franchises. which
ought 10 be included in any estimate OF the valua-
fion Of its earning property
The chief fight before the United States Supreme
Court will be made the inclusion OF the fran
chises property. which the gas company
claims that II should De allowed a lalr fetui IL
Had Judge Hough ruled them out. the law would
have been declared constitutional but by the addi-
ton OF the s2olo.coo which he valued them, the
valuation of the company's earning power was
brought up 10 SeGooop, which the estimated
annual income of s3oSo.oo would not have allowed
q return of per cent; that is. fair and reason
able return
As none OF the Brooklyn companies obtained an
Injunction restraining the state and city authori-
ties from making the law effective. but reserved
the hight TO collect % cents extra each thousand
cubic feet of gas furnished TO the consumer in
case the validity of the law was not sustained,
l3rooklynites will still continue TO pay only 80 cents
pending the Supreme Courts decision