Los Angeles herald., 1908-08-19
WATER COMPANY
WINS ITS CASE
LONG BEACH ORDINANCE Is
DECLARED INVALID
JUDGE HUTTON ORDERS THAT
INJUNCTION ISSUE
Holds Enforcement of Measure Passed
by City Council Tantamount to
Invasion of Plaintiffs Con-
stltutionaI Rights

OF great Importance, not only to the
community of Long Beach but also to
other municipalities in California where
similar actions have been or are about
to be instituted, is the decision handed
down yesterday by Judge G. H. Hutton
of the superior court in the case of the
Long Beach Water company against
the city OF Long Beach, in which the
water company sought an injunction
restraining the city. council from carry
ing into effect rates in accordance with
the valuation placed upon its plant by a
commission appointed by the city coun-
Gil. The court finds in favor of the
water company and holds that the or
dinanee fixing the rates should be an
nulled.
In February last the Long Beach city
council held an investigation, as a re-
suit of which the valuation of the water
company's plant was fixed at $340, 0,000,
and on this basis an ordinance was
passed fixing a schedule of prices below
those then prevailing. The water COM
pany sued for an injunction on the
ground that the schedule was too low
and practically compelled 1t to conduct
business at loss. 1t placed the value
of its property at $S1004S. A temporary
restraining order was issued, effective
until July /, when it was continued
until the trial of the case, which began
about three weeks ago and ended Fri
day last
In his decision Judge Hutton says the
question to be determined is whether or
not the rates fixed by the ordinance in
February would render to the company
q, reasonable and legal compensation,
reciting the fact that it should be borne
in mind that the rights of the plaintitf
company depend upon the provisions OF
the state and federal constitutions pro-
foI Of 70
for public use without just compensa-
tion..
ut is not for the courts to set aside
ordinances of this kind because the
compensation seems too high or too
low" says the court. 1.-THE question is
whether or not the enforcement of this
ordinance will be an invasion of the
plaintiffs constitutional rights under a
constitutional provision"
Judge Hutton refers to the case OF
the San Diego Water company against
San Diego, and particularly the IAN
guage of Justice Van Fleet, who said
in part: ut is not the water or the
distributing works which the company
may be said to own and the value OF
which is to be ascertained. They were
acquired and contributed for the use OF
the public. What the company has
parted with and what the public has
acquired is the money reasonably ana
properly expended by the company in
acquiring it's property and constructing
it's works. The state has taken the use
of that money and it is for that use
that it must provide compensation"
Redlands Case Cited
The court says it would be bound by
the standard so fixed in this opinion
were it not that later decision in the
case of the Redlands Water company
against Redlands fixes the standard as
fine s'yalue of the property necessarily
used in furnishing the water at the time
the rate was fixed, plus necessary ope-
rating expenses" thus reversing the
portion of the San Diego case cited
above.
Judge Hutton also quotes specific
statement by the supreme court OF the
United States that a reasonable allow
ance for annual depreciation be made,
and says
sIn the light of the decisions above
CONTINUED Page Two)