The news scimitar. (Memphis, Tenn.) 1907-1926, 1920-01-08
LOW RATES CAUSE
Of RECEVERSH|P
LIGHT CO. AYERS
J. F. Rainier and F. S. EIgin
Are Named as Receivers.
Chattanooga Range Con-
Germ Is Petitioner in Case.

]. f Rainier vice president and gen.
eral maager of the Memphis Gas &
Electric company, and Frank S. Elgin
lawyer, and co-receiver of the Mem.
phis Street Railway company, were
named as receivers for the Memphis
Gas & Electric company by Judge Johr
=. Mccall Thursday morning follow.
ing the filing of an answer by the gas
company to the complaint filed against
1t by the Vesta Gas Range Manufac.
turing company, seeking receivership
The appointment of Mr.. Rainier bS
the court was made conditional upon
his resignation as president and gen.
eral manager Of the gas company.
There is little to be said in add.
filed by the company today" said w
M. Flock, of New York, president oi
the Memphis Gas & Electric company,
who was present when receivers were
named.
The submission of the company tc
receivership was made unavoidable by
its inability to secure an increase In
revenues, sufficient to meet the great
increase in costs of materials and labor
required to serve the public and in.
duce investment of new capital re-
quired by the demands of Memphis fol
enlarged gas and electric service.
The city Is growing and our plants
must be enlarged but in my judgment
neither can that be done, nor can the
present pant a"d s-r e, ra n
and solyency be restored if present
rates and costs are to continue.
Say Rates Too Low.
In replying to the bill of complaint
IN which the gas company admits each
and every allegation contained in the
Dill OF complaint and consents to re-
unf Ottf ,Nok
that the financial difficulties of the
defendant are the direct result of its
inability to make any increase in
charges forYits products over the price
fixed in 1915" The answer concludes
with the following.
Assuming that the application OF
complainant for the appointment of a
receiver or receivers viii be granted,
defendant respectfully suggests that
since 1t appears from the bill and an
answer herein the necessity for action
by this honorable court arises through
no neglect or inefficieney of defendant
but from causes wholly beyond its con-
troll that j, F. Rainier now vice -presi-
dent and general manager of defendant,
be named as receiver, If there be but
one appointed, or if there be two re-
ceivers appointed, that he be one of
those named"
The Vesta Gas Range Manufacturing
company, who filed the petition for re-
ceivership, is located at Chattanooga,
Tenn, Chas. c. Huntingdon, formerly
of Memphss is president of the con-
Germ and F. f. Sparks, vice-president
and treasurer, signed the petition for
the complainants. Henry Wetter. pres
ident of the Wetter Manufacturing COM
pany, is a large stocklholder in the
Vesta company and. Chas. c. Hunt
ingdon was formerly vice-president of
the Wetter Manufacturing company.
The petition sets forth that the Mem
phis Gas and Electric company is in
debted to the Vesta Gas Range Manu-
featuring company in the sum of $751;
975.75 for gas ranges shipped to the
Memphis concern. Repeated demands
for payment have not been complied
with and the petition further states
that 1t Is the belief of the creditor that
the gas company is unable to meet the
obligation
Other creditors are mentioned in the
petition including the city of Memphis
$50, 900 for taxes; New York and Mem
phis banks npromissory notes to the
amount of approximately 81, 000, 900. and
several persons and firms for material
and supplies to the amount of $3.50, 00O
An item of interest, due Jan. /, amount
ing to s19S, 900, and another which will
become due May l. for $31 $50.
The application. for receivership. to-
gether with the action of the attorneys
for the gas company, Wright, Miles,
Waring & Walker, in entering its ap-
pearance and their determination not
to resist the petition, in the opinion of
many, is but another move in the ef-
fort Of the gas company to secure a
raise in rates. Two attempts to secure
this raise have failed and a third petit
tion will he heard by the public utili-
ties commission in the near future.
The third application for raise in
gas rates is set for hearing before the
state commission on Monday. In 1t the
company asks nominally for raise of
35 cents per thousand feet on gas, but
the insertion of a joker in the form
of so cents added to each bill prac-
tically would double the charge on all
small consumers. 1t is not known yet
what course Judge Mccall will order
the receivers to pursue in the prosecu-
tion of this application.
Counsel for the city has not yet been
able to get access to the statement Of
the company of date Dec. 81. This and
the lack of an immediate direction from
Judge Mccall possibly may cause de-
Low in the hearing