The San Francisco call., 1908-10-13
Is Prepared to Produce Evidence
That Spring Valley Can
Not Increase Rates
Corporation Is Satisfied With
Injunction and Is Ready to
File Bond


sustain his contention whenever the is
sue may be forced. 1t was reported
yesterday that the Spring Valley COM
pany would hasten a judicial interpre-
tation by asking for a modification OF
the injunction 10 allow of the collection
Of the extra charge. This report was
denied, however, by E. ]. McCutchen.
attorney for the company.
We are satisfied with the injunc-
ion" said McCutchen yesterday, and
viii not ask for any modification. We
win file our bond tomorrow, thus Civ
ing Official notice of our acceptance or
the injunction as granted"
McCutchen continues to maintain that
the corporation has the right to force
payment Of the increased rate.
Long pointed out yesterday that Judge
harrington had laid particular stress
upon the Consolidated gas case Of New
York and the Buffalo gas litigation,
quoting from the decisions in those
controversies. which parallel as to the
point at issue the Spring Valley case.
In the Consolidated gas case the court
held that the company might collect
the rate II desired to put into effect
from such as choose to pay" In the
Buffalo case the court ruled that the
consumer may have the option of pay
ing the higher or lower rate"
Long holds il was the idea of Judge
Harrington to follow those precedents,
and that the court therefore inserted
the much discussed article 10, which
states that nothing in the decision shall
be construed as requiring any consumer
10 pay more than the schedule fixed by
the board of supervisors.
PRECEDENTS FOLLOWED
The section Of his decision in which
Judge harrington refers 10 the gas
rases follows:
In Consolidated Gas vs. Mayer. LAG Fed.
100. two acts Of the legislature and an order
Il tine gas company reducing gas rates from
81 10 50 cents per loo cubic feet were at
,acked An interlocutory injunction was is
sued in which it was provided that the gas
company might charge or demand payment
al the cid rate and might collect at that
rate from such choose 20 pay.
il is also provided thar she difference 50
caliected between the OLD rate and the new
rate should be imp0unded under the direc-
ti.n Of the court TO fully insure its re
tura 70 the person paying the same, IN the
event Of the conpany's falling 10 succeed
ia It's litigation
similar order was made IN the Buffalo
tias Company Buffalo. l5G Fed $40. The
Sas company asked leave Of the court TO is
TO It's customers bills or demands for gas
riisuined each month At Ihe rate OF 81 per
IH00 feet. the difference between such sum
paid by the customer and the amount fixed
iy the commission 10 be impounded until the
controversy may be determined" " The order
made, but with the provision that the
customer may have the option Of paying the
higher OF lower rate"
Il viii be seen from the orders issued
n both gas cases that the courts OF
Aew York state ordered the money in
ontroversy impoundec. just as Judge
harrington has done. In both gas
.ases the court decided that the con-
sumner was not compelled to pay the ex-
ess and Long holds that Judge Far
.ingtons ruling parallels the gas cases
.n this regard.
Long is preparing a syllabus OF the
decision OF Judge harrington, and in
speaking Of the matter yesterday he
showed that the court had discussed
with a nicely of detail the division of
power on the question Of rate making.
Judge Harrington differentiated be-
.ween the authority vested in the court,
he board of supervisors and the COM
pany. Long emphasized the fact that
Judge Harrington had nowhere given
the company power to enforce the
higher rate, but had merely said that it
may" collect the additional amount 1t
is this portion of the decision which,
according TO Long, corroborates abso-
lutely his Interpretation Of article 10
that the consumer is not required to
pay the excess.
II the court attempts 70 prescribe rates to
be collected pending suit Il is at once met
with the objection that it has no more power
10 hK rates than the board has 10 adtudge a
rate fixing ordinance valid and consfitu-
tionsl; but the court has less power 10
deal with rates prescribed by the company
than 70 deal with rates established by ordi-
nance.
1t has been established in this proceeding
that complainant is probably entitled to
gross income $266 1880 larger than the
present rate will afford and that sum will
probably be lost II not In some manner pro-
tecteo by the court This can only be &C
complished by so prohibiting the enforcement
OF the ordinance that complainant may col
lect the additional amount from its eus-
toners. So much relief complainant ought TO
IS horr
Judge with even hands its interlocufory re-
lief by the circumstances. conditions and
rights which have appeared, TO the end that
each party shall suffer the minimum of in
jury. But at this time in these proceedings,
under what principle can an order be justi-
fed By which the court says in eject to
complainant, You are entitled 10 so much
relief; fhis the court deems just and rea-
eonabiei you VIII not only be permitted TO
take this, but VIII be put in such a position
that you can take as much more as you
True, this court can not FIX water rates.
but Il can require each suitor who seeks
equity 70 % equity or go away empty. II
interlOcutory injunction issued without
restriction, water rates VIII be arranged by
contract between complainant and its Gus
toners. IT Is urged that any such restric-
ton would be improper because they would
violate complainant's right OF contract which
also IS protected by the federal constitution.
CAN NOT FIX EXCESSIVE PRICES
II is unnecessary at the present time TO
define cOmpainant's coDtractural rights nm
der the ordinance when IL is IN force 1t Is
Slfncient 10 say that the COMPANY can not
Ok prices in excess OF those specified in the
ordnance which consumers must accent or
Otherwise forego the OF water: nor can
Il enjoy exercise any such right during
the present year and pending this SUIT ex-
cept the result Of exercise of 5udicial
discretion by this court in behalf of tie
company This Is not where the con-
stitution has left the legislature or 10
the board OF supervisors the power and dis
eretion 10 decide when water rate regulation
IS necessary and proper. IN addition 10 the
power and discretion TO regulate such rates
Under such a law when the rate fixing
agency. presunAng such regulation is I'M
necessary, has failed 10 act the water
owner and the water consumer may contract
freely. This is what is decided in Fresno
canal. etc, co. VS. Park, 129 Cal. 437: hut
here there is no presumption that reRula-
tion Is unnecessary: the constitution has de-
csred the necessity OF regulation and under
severe sanction requires the board TO TX rates
each year.
II now the court in its discretion sees ht to
grant Injunction pending the suit under
conditions which limit complainant's liberty
20 exact rates. 1t is simply defining the
privilege which 1t confers. not curtailing a
right.
BANKRUPTCY ACTION INSTITUTED
Involuntary bankruptcy proceedings
were brought against the Vallejo Roch-