The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1910-04-29
Attorney Goldsborough Begins Argument
in Defense of Rights of Corporation.
Cites Decisions on Questions

| ever VIII De OntnlnkaDle TO our rnlndS
that you or any of you would, II you
could. Intentionally degrade or destroy
us. We do not profess, Gentlemen Of the
/ Committee, TO be either infanible or I'M
/ peccable. nor pretend to be above cris-
icism or correction. We have no special
! privileges TO plead and whereof we
stand accused We are ready to be tried;
! but. with all due respect 10 It's dis
! tinguished author we confidently do sub
NIT that we should not be compelled to
go TO trial. in any case, upon an ndict-
ment stripped to the bUn-thats what
/ this bill Isl that charges no offense. What
crimes have we committed Mr.. Chairman,
to justify the drastic punishment proposed
20 be inflicted upon us in and by this
measure? How can we defend il by any
other plea than mot guilty Of the things
whereof we have been charged outside OF
these corridors-than by begging YOU 10
patiently lend US your attention whilst l
address myself 30 facts that have else
where been put in controversy and TO hear
me with a judicial mind that the truth
may set us free.
Briefly summarized. then. Gentlemen OF
the Committee. the reasons, as we un-
derstand them. assigned or 20 be assigned
by the advocates Of the proposed measure
70 justify its passages. are as follows
Because II Is alleged. there Is evidence
tending to show:
J. That our predecessors In Office and
title destroyed the books something like
a generation ago. and therefore we can
not satisfactorily prove that any material
part Of our investment was ever actually
paid in TO the Company by IT'S stock
holders
That the profits OF the business are
out Of proportion TO the actual cost Of
the property. and therefore excessive:
3. That our rates are exorbitantIy
high. whether measured by actual cost.
by inherent value. or by prices elsewhere:
T. That the Washington Gaslight Com
pany is already Overcapitalized.
>. That 1t is believed 20 be immoral
and inequitable, from a public point OF
view. for public service corporations 70
invest and reinvest profits into better
ment or to predicate rates upon their
value when thus inenect capitalized:
6. And finally. because n is more or
less seriously claimed by the proponents
. OF this proposition. that even physical
assets cannot be capitalized, either di-
rectly or indirectly by public service
d corporation without an invasion Of public
rights In other words that Capitalization.
whether true or false. so necessarily in
wolves the public equities as TO rates
that its enlargement is against public
policy and should be legally prohibited
although the Company. in effect is there
b. denied the equal protection OF the laws
guaranteed to all-the artificial person as
well as the natural person-of which
= none may be deprived. even by Congress
itself, without due process OF law.
Mr.. Chairman. this is the case. and thl,
is all there is TO II which We are here 4
try-a case built up, as I trust. TO be able
20 easily satisfy the Committee, upon q
! theory that is unfounded in fact-a doc
trine that is unwarranted in law and ut
terly repugnant in both letter and spiri
to every decision of the Supreme Cour
upon the subject rendered within the las
= thirty years. Unfortunately for US. thi,
fact does not forclose the controversy I,
20 those who believe there is vet a highe
4 court. a tribunal in the consciences o
g men. that will some day proclaim a We
= higher code. when socialism sits crowned
: in the Capitol If the fullness Of tim
4 were ripe, ! should not hopelessly appea
;. even TO socialism in such a case; but t
L you who are under bond. so 10 speak. {,
o the Constitution as It stands. | feel w
n can confidently look for the protection 1
@ grants 10 all and the relief 1t denies &
r none who are within their rights. /
l. may not prove amiss. therefore. for m
d TO anticipate, just here before going int
s facts. as I propose to do fully later on
20 the rules Of the law that / shall argu
!. 10 you in due course. define our right
d ard limits yours In the premises. The
Y may he briefly summarized as follows
II !. An established rate can only h
!. deemed excessive when il will yield NOR
g than reasonable return upon the actua
n value Of the investment
# ? All public service corporations hav
+ right 10 make and distribute earning
" upon the actual value OF the prOpert
e employed in the conduct of our bushes
IS irrespective Of its ownership-and, o
n course. irrespective Of the face value o
e par value Of the securities outstandin
;: against it-or of their ownership.
5 3. The Company's franchises are pror
II erty. and as such are assets upon whic
2 Il is entitled to predicate earnings
d (. That public utilities do not have t
lie be incorporated-their rights as to rate
ot relative to those Of the public bein
st mutIsI and wholly independent OF pape
is capitalization
At Mr.. Rothermel-"Is that fact?"
j. Mr.. GOldsborough-"U Undoubtedly, an
3. our charter and its various amendment
Is prove it, For every requirement in it. i
So terms provides that every person. co-part
Sc nership, association or corporation in III
v District Of Columbia making and sellin
v. gas. &c. we have precisely the sam
ie rights and are under the same obligation
Of that we would have had coming to us
- our incorporates had formed co-part
Is nership without issuing stock of any kin,
20 and the price of gas in that event. as nov
r, would have been determined by the valu
he Of the property used in producing it, 7
he go on with my parity:
N ;. That public utilities if capitalize
in at all, should without exception be idea
e. " capitalized; that is to say that ther
n should be a true coincidence and col
respondence between the actual capita
ne izstion inherent in the value Of the II
VI vestment and the par or face value
ne the securities issued against II. to Il
Mt end that every dollar in securities ma
n. represent neither more nor less tina
Mt 100 cents worth Of property, invariabl
AL TO be honestly assessed
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