The Pensacola journal. (Pensacola, Fla.) 1898-1985, 1920-01-27
RECEIVER GETS
STREET LINES
Judge Sheppard Signs Order
Naming j. G.. Holtzclaw on
Petition Bond Holders.
WILL ASK RATE INCREASE
Cause of Receivership Given as
Inability to Operate on a
Five Cent Fare.

In the United States court yester-a
day morning, Judge Sheppard signed
an order naming ]. G.. Holtzclaw re-
ceiver of the Pensacola Electric Co.
The application was made by the Old
Colony Trust CO. of Boston, a general
creditor of the Pensacola Electric Co.
to the extent of about $4,000. John
p. Stokes represented the complainant
and Peter o. knight, general counsel
for the Stone & Webster properties
in Florida was senior counsel for the
electric company.
After the order was signed Mr..
knight issued a statement in which
he asserted the receivership had be-
come necessary because the roads
were unable to operate successfully
under a five-cent fare. His state.
ment follows:
The prime cause of the receivership
of the property is its utter inability
to operate upon a five cent fare and
by reason thereof it is also unable to
have sufficient credit TO borrow any
money to pay its debts. 1t could
therefore, not pay the Indebtedness
of the Old Colony Truct Company
and the complainant, knowing that
the Pensacola Electric Company was
unable to pay the interest amounting
to 100000 on the bonds of the COM
pany due February /, 1920. and know
ing that If such interest was not paid
the default would permit the trustees
of the mortgage, given to secure the
bonds. to foreclose the same, the re-
suit of which would be the probable
dismemberment of the street railway ,
company as a going concern. for it's
own protection and others in like situ-
alton, requested the appointment of a
receiver for the purpose of preserving
the property for the benefit Of the /
public, the creditors, and the stock |
holders. 1 imagine that after the re- !
ceiver takes charge of the property |
and goes into the situation fully, he
will apply to the Florida railroad com
mission requesting them to fix just
and reasonable rates for the carriage
Such is the course that has /
been pursued in the Jacksonville I
Traction Company situation The |
Florida railroad commission has ex-
elusive jurisdiction over rates to be |
charged by all railways, road compa-l
nies and common carriers, and it is /
its duty, under the statutes of this I
state to fix Just and reasonable rates /
for such companies. The supreme
court of Florida, in the Tampa water
works case reported in the IS Flor
ida, page coo, held that section 20
of article 16 of the constitution of
1885 reserved to the legislature the
power to regulate by its own act or
thru some other instrumentality. the
rates to be charged by public service
and that every charter
granted subsequently to public service
and every contract made
with them by the legislature or a
are granted, made and
accepted subject to and in contempla
ton of a possibility of the subsequent
exercise of the power which by that
section is declared to be vested in the
legislature. The section mentioned
not only becomes a part of every such
charter or contract, as much so as If
written therein, but it denies the au-
thority of the legislature, by implca-
ton, to stop itself by contract or 10
authorize a municipality to so bind it
not to exercise the power thereby rec
ognized, whenever. in its wisdom, it
shall think necessary TO do So When
the city of Pensacola, therefore pass
ed the ordinance granting TO the Pen
sacola Electric Company franchise
and fixing the rate Of fare therein at
five cents, it did so with the under
standing that this section OF the con-
stitution was a part of tke same. as
much as If It We're written therein.
This case was affirmed by the SUI
oreme court OF the United States. and
s. therefore. settled law of this state
However, the decision in the water
works case by our supreme court is
n conformity with all of the later
decisions of all of the courts OF this
country. The situation in Pensacola
5 not an unusual one. The Jackson
vile and Savannah companies are
fNa ~...;~,,.L =. 60