Case Name: The People of the State of New York, Respondent, v. Albion Water Works Company, Appellant
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1910-11-15
Citations: 140 A.D. 646
Docket Number: 
Parties: The People of the State of New York, Respondent, v. Albion Water Works Company, Appellant.
Judges: 
Reporter: Appellate Division Reports
Volume: 140
Pages: 646–650

Head Matter:
The People of the State of New York, Respondent, v. Albion Water Works Company, Appellant.
Fourth Department,
November 15, 1910.
Public service corporations — water supply company — unjust discrimination — pleading — defenses.
A water supply company, organized only to supply the inhabitants of a certain village, when sued in equity by the People of the State to compel it to furnish water to a State institution situated outside of the village at the same rate at which it is furnished to the inhabitants of the village, is entitled to show that it makes no unjust discrimination against the People under an answer which alleges that the water furnished to the State institution is reasonably worth the sum charged, that it cannot be furnished at the same rates made to inhabitants of the village without loss, that the conduit to the State institution was laid by the defendant at its own cost and at the request of the public authorities, that the village pays a certain sum annually for fire protection and that the rates charged to the inhabitants of the village are regulated entirely by contract.
There is not necessarily an unjust discrimination because different rates are charged to different consumers if the circumstances under which the water is furnished differ and the price charged in each case is reasonable.
Appeal by the defendant, the Albion Water Works Company, from an interlocutory judgment of the Supreme Court in favor of • the plaintiff, entered in the office of the clerk of the county of Orleans on the 30th day of March, 1910, upon the decision of the court, rendered after a trial at the Erie Special Term, sustaining the plaintiffs demurrer to the amended answer, and also from a judgment entered in said clerk’s office on the 23d day of May, 1910, on failure of the defendant to answer over as permitted in the interlocutory judgment.
W. Crawford Ramsdale, for the appellant.
Edward H. Letchworth, Deputy Attorney General, and Edward R. O’Malley, Attorney-General, for the respondent.

Opinion:
Spring, J.:
The action is in equity by the People of the State for the purpose of obtaining a judgment perpetually enjoining the defendant from ceasing to deliver water to the Western House obBefuge for Women at Albion, N. Y. The Western House of Befuge for Women is a State charitable institution located in the town of Albion, but not within the village of that name.
The defendant is a domestic corporation organized for the purpose and engaged in the business of supplying water to the inhabitants of the village of Albion. The prices which had long been charged to the patrons of the defendant for water furnished were regulated, according to the quantities taken, and for 5,000 to 10,000 gallons daily received by one taker such price was fifteen cents per 1,000 gallons, and for 10,000 to 50,000 gallons twelve cents per 1,000 gallons.
The defendant laid a line of pipe between 400 and 500 feet in length from its main line in the village of Albion to the institution .named, and lias supplied it with water since prior to January, 1900, exceeding at all times 5,000 gallons daily, and for which the defendant has been paid twenty cents per 1,000 gallons. The price charged was paid without protest or objection until shortly prior to the commencement of this action in January, 1910. The quantity of water which has been received daily from the defendant for the use of said House of Refuge for Women for some time prior to the commencement of the action has exceeded 10,000 gallons. The defendant is willing to furnish all that may be required for the sum of twenty cents per 1,000 gallons, and the State is willing to pay twelve cents per 1,000 gallons, which is according to the schedule of rates for the inhabitants of the village.
The contention of the State and the basis of its cause of action are that in charging the House of Refuge a larger sum than is paid by other patrons of the defendant using a like quantity of water the defendant unjustly discriminates against the State. As the question is raised by demurrer to the answer, its determination must depend on this appeal wholly upon the pleadings.
The defendant was organized in July, 1887, pursuant to chapter 737 of the" Laws of 1873, and the various amending acts. It was created for the purpose of supplying to the village of Albion and its inhabitants water for domestic uses and for fire protection. Its pumping station is in the town of Albion, about one-half mile from the village boundary line; and from the station to the village the defendant's main is laid in a public highway of the town. All its other mains, except the line to the House of Refuge, are laid in the village of Albion, which is located in the towns of Albion and Gaines.
The answer alleges that the water furnished to the House of Refuge " is reasonably and fairly worth the sum of 20c per thousand gallons and that said water cannot be so furnished by the defendant at 12c per thousand gallons without loss to the defendant." In support of this general averment are certain facts contained in the answer aside from those already adverted to. It is alleged that the pipe or conduit from its main line to the House of Refuge was laid by the defendant at its own cost and "at the request of the public authorities " of said institution. Also, that the village of Albion pays annually to the defendant for fire protection $3,900, and that the rates charged to the inhabitants of that village are regulated entirely by contract.
We think under its answer the defendant may prove facts which will exonerate it from the charge of unreasonably discriminating against the plaintiff. There is no claim that the rates charged by the defendant must be unvaryingly uniform. The schedule of rates based upon the quantity of water furnished is not assailed. Charging for a small quantity more per gallon than for a much larger supply furnished is not of itself an unjust or illegal discrimination. (Silkman v. Water Comrs., 152 N. Y. 327, 332.)
The defendant may supply water to the public school buildings or to charitable institutions without charge and not be properly subject to the accusation of undue preference to these institutions. If a manufacturing company with its plant in the town of Albion or of Gaines, several miles distant from the defendant's water line, requests that it may be supplied with water and the defendant at great expense complies with the request and lays the line, it might be unreasonable for the manufacturing company to insist that the tariff rates issued and applicable to the inhabitants of the village of Albion should control in fixing the rates to itself.
In construing a question of this kind the test finally must be whether the price charged is reasonable. The prices paid by the other consumers may have an important bearing upon that proposition, but they are not invariably conclusive. Dissimilarity of situation, difference in the cost of furnishing the water and other factors may enter into the problem. Different conditions may justify the imposition of different rates. (Farnham Waters & Water Rights, § 162c; 30 Am. & Eng. Encyc. of Law [2d ed.], 427.)
The question is, therefore, dependent upon the facts pertinent to the situation.
It is not important now to determine whether section 81 of the Transportation Corporations Law (Consol. Laws, chap. 63; Laws of 1909, chap. 219) is applicable. That question may never be reached in this case. The only proposition we determine is that the defendant by the affirmative allegations in its answer; in connection with the facts admitted, has raised issues of fact. Within the compass of its answer the defendant may satisfy the court that the rate charged the House of Befuge is reasonable and, hence, not unjustly discriminatory. It is not wise to determine this important proposition upon the pleadings as the answer contains denials, several of the admissions are only partial, and affirmative facts are alleged, which, if proved, may tend to show that the House of Refuge has not been unfairly treated.
The final judgment and interlocutory judgment should be reversed, with costs of this appeal to the appellant, and the demur-. rer to the answer overruled', with costs.
'All concurred; McLennan, P. J., in result only, being of the opinion that the rates charged by the defendant to consumers of water in the village are entirely immaterial.
Final and interlocutory judgments reversed, with costs of this appeal to appellant, and demurrer to answer overruled, with costs.