Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-12-11
THE LAW SUSTAINED
Public Utilities Commission
Upheld by Court.
POINTS IN THE OPINION
Relations Between Corporations and
the Public.
HOW THE STATUTE OPERATES
Good Feeling ENTHUSIASTICALLY
Conferences Held, Which Are
Productive of Good.
BY WILLIAM E. CURTIS.
| Special Correspondence Of The Star ana the
| Chicago tsecord- Herald.

BY WILLIAM E. CURTIS.
Special Correspondence Of The Star ana the
CHICAGO record Herald
ALBANY, N Y, December Q. 1907.
The supreme court of the state OF Ne"
York has affirmed the constitutionality OF
the public utilities law enacted by the leg
islature last winter, which many able
lawyers questioned or denied, -including
the right of that commission to fix rates
and scharges for all forms Of public serv-
ice Under this decision the commission
has authority to say how much the people
of New York state shall pay for their
gas or electric light and power. and how
much the railway companies shall charge
for transporting freight and passengers,
and if the-jurisdiction of the commission
is confirmed they will have the power to
regulates the tariff for hacks and car
riages. for hauling trunks and express
packages. Indeed, under this decision the
commission may fix rates for every form
of service furnished the public by any
Individual or corporation, SUBJECT to re-
views by the courts If they are complained
of as unreasonable. The term public
service" has NOE yet been defined. and
there are, of course. wide differences OF
opinion as to it's limits. But It is con-
coded under the recent opinion of the SUI
preme court of this state that the legisla-
ture has the right to delegate to the
commission appointed by the governor all
the power and authority it possesses over
corporations and individuals who serve
the public
Sometime, no doubt, the courts will be
asked to determine what a public serv-
ice is, and whether that term includes
barber and man with a pushcart as
well as street railway company.
The Courts Opinion.
The opinion of the supreme court was
not unanimous. The justices were d.
vided, three to two. The appeal came
from the village of Saratoga, where the
gas company refused to accept the rates
fixed by the commission and appealed
The chief justice, in delivering the opin-
ion. among other things. said:
This commission has assumed to fix
i1hS nun eharge for gas and
BY this appeal their right to do SO is
challenged. upon the ground that such
power is legislative and cannot be dele
gated to a commission. The question
raised is an important one. as 1t goes to
been adopted by the state, and which.
if such power be denied. is of little eff
cacy That the power to fix tariff of
rates for public service corporation is
CACCulINC, Will Dc Q0nlGQ. SuCl
power as an original power is not Judi
cial will be admitted. In Interstate Com
merce Commission VS.. Railway Company,
1857 Y. S.. 400. Justice Brewer, in writing
for the court, say the power to estab-
lsh tariff Of rates for carriage and by
a common carrier is legislative and
not an administrative or judicial function
In G. b. & Q. Il. r. Co. VS.. Jones, 149
ILL.,, 81, 1t is said the power to regulate
and control the charges of railroad COM
nQ ut
lie employments is legislative and not
Although legislative power, properly
speaking, cannot be delegated, the law
making body. having enacted into. the
statutes the standard of charges which
shall control, may intrust to an admin
istrative body not exercising in the true
sense judicial power, the duty to fix rates
In conformity with that standard. In the
same brief twenty-five states are named
which have similar statutes
I'm the courts of this state this ques-
ton has not been directly decided but
the principle is, l think. established in
analogous cases.
Justified by Authority.
ut will thus be seen that the assump-
ton of this power by the commission
Is justified by convincing authority. Not
a decision is cited in the state or federal
courts which questions the power pro-
vided the determination of the commits
sioners is directed by some standard
which is presented in the statute. 1t is
strongly insisted that the statute fixes
no such standard. If in this the appellant
be correct. the authorities cited, 1t is
claimed, establish the unconstitutional
ity OF the act The power o. the COM
mission Is given in these words: After
such hearing and upon investigation as
may have been made by the commission.
commission, within the limits prescribed
by law, may fix the maximum price Of gas
or electricity, which shall be charged by
such corporation or person in such inu-
hic!pahty. me commissioners are not re-
CURED In explicit terms to fix a reason
able rate, nor just rate. nor an equal
ate. They are given no standard as a
percentage of profits by which they are
to fix the rate. Their only guide Is to
fix the rate within the limits prescribed
The law is settled by repeated ad.
Indication that the legislature itself cam
not FIX rate which would be confiscatory
OF the property O., the corporation. The
service CO poration has not the right
or purely private corporation. to charg
what 1t will for its product, but must
serve the public at just and reasonable
Entitled Only to Fair Return.
ut thus appears that the stockholders
Of public service corporation are not
entitled to require the public to pay divi-
dends upon fictitious stock or for their
extravaganza or waste. Such a corpora
ton, "however, is entitled to a fair re-
turn upon the actual value Of its prop
erty that 1t Is devoting to the pub ic
use after paying all expenses and liabili-
ties reasonably charged against the same.
What is deemed a fair return must de-
pend ultimately upon the judgment of the
Both upon principle and necessity, a
fair return upon the value of the prop
erty actually used, Is such a return as
shall be fair compensation for the ,isk
assumed by the investor in permitting
his money to remain in such an enter
prise. The public cannot fairly Dues
ton this application of the rule, and
must pay such rates as will ordinarily
yield such return to the stockholders Of
the public service corporation. The court
is charged not only with the duty of pro-
tecting the public interest but also with
a duty no less solemn of protecting the
property rights of those whose moneys
are invested In public service corpora
ton"
Far-Reaching influence.
This decision will have an effect upon
all future legislation concerning the reg
ulation of rates by state authority, and
If it is not carried to the Supreme Court