New-York tribune., 1907-12-25
POINT FOR GAS COMPANY
STTST4INS ITS DEHCRRER.
Justice Mccall Cites Decision tn tify
Against Brooklyn Union.

Justice Mccall, in the Supreme Court hahdeu
aopn a decision yesterday SUSTAINING the ooIisoil
szrea Gas Company in the demurrer interrosed hy
sherman & Sterling counsel for that corporauoh'
), .te answer fled by the city of New York.
through the Corporation Counsel TO SUIT oeiilaho-
ing ss24 sls 7s being the amount charged Ior tie
lighting of Manhattan and The Bronx Tor the
year 1903. =,
.un,lied light 10 Manhattan and The Bronx, and
that in December 1892. in reply TO proposals niaoe
on behalf of the city. it rendered BID for inc
lighting OF these boroughs. with the exception OF
certain districts in which the gas mains were me
property Of the Standard Gas Light Company, the
New Amsterdam Gas Company and the New 1ork
Mutual Gas Company. The Commissioner or water
Suppiy Gas and Electricity did not reject the fld
II the plaintiff company. and the amount which
accrued due at the rate permitted by law came
% ssas 2a7 70 which the city authorities refused TO
oav.
The answer of the city set up that the Consoli-
slated Gas Company owned controlled every corpo-
-ation in these borougs supplying illuminating gas
sjEh the exception of the Bronx Gas and Electric
,o-nnsuv and that IL was formed to regulate and
SID regulate and control the price of gas thereby es
tabishfng monopoly in the price of gas Ihe con-
solidated Gas Company, it was alleged was fur-
her organized to prevent competition by other
-nmpanies and the consolidation by il OF other
-on,nanies was declared 10 against public pol
~ illegal and void under the provisions OF 1hap-
.er $50 of che laws of 1929. Because OF TINS there
Ess no standard market price for gas or eiec-
ricitv and the only manner in which such reason
,ble nrice could be ascertained was by deternlin-
,1g the cost of production and distributor ano
adding thereto a sum sufficient 20 return a fair
profit upon the money actually invested IN eHo
olls;uess with due regard 10 the hazard lnFoNeo
The law passed in 1sg7, by which the lrlee Oh
ras s,Ipplied to the city of New York was 10 be
.edcad in sums of 2lS cents 1890 cubic feet from
pzlz cents in in 1901 and thereafter
vas alleged TO he excessive and above the fair
and reasonable value for the supply OF gas 10 the
rnuuicipaIity No contract made by the city
FOR 1903, it was alleged. and the bid of the gas
company was rejected by the Board of Estimate
upon the recommendation Of the Commissioner OF
Mater Supply, Gas and Electricity. on December
g. 1908.
The answer further alleged that the gas COM
psny was a public servant or quasi-pubhc cor
norafion and was bound furnish light 10 the
city and was entitled TO recover only the falr
vaIue of the same. The city also alleged that un-
Ser a law passed in 1895 the price OF illuminating
gas to the city was fixed at 40 cents l,vO CUBIC
feet which would be a fair price. taking into ac-
count the lessened cost of production and distrou-
ton and the increased quantity of gas consumed
by the city.
The law of 1897 was said TO be unconstitutional,
ss abridging the rights and privileges of the city
and Deriving IL Of its property without due process
of law by requiring payment of a price above the
fair and reasonable value OF the commodity sup
piled.
~
The ground that it upon its face value insult
scient in law. Justice Mccall, in sustaining this
semurre-, says he does on the authority of the
SECESSION the suit brought against the city by
the Brooklyn Union Gas Company
And perhaps" he adds, it were well, owing to
he fact that the question involyed-to wit, the
.onstitutionality of statute-that this litigation
dpon the precise point will ultimately go TO our
highest court of review; that the court of first
instance leave the question disposed of upon the
authority il asserts controlling without fur
her or extended memoranda Leave, of course
Rifhin twenty days 20 amend upon payment of
costs