Court Opinion

ID: 3998462
Source: CourtListenerOpinion
Date Created: 2016-07-06 10:56:00.256204+00
Date Added: 2024-06-11T14:18:49.780689
License: Public Domain

It is to be remembered that we are not here concerned with the exercise of a sovereign power by the city. It is here as any other private party to a contract providing for fixing of a reasonable charge for the use of its property, namely, its streets. Spokane v. Spokane Gas  Fuel Co., 175 Wash. 103,26 P.2d 1034. I take it the "reasonable value" of such a franchise right is the "usable value" — the value to the holder operating under it.
In 1904, the right to lay gas mains in the streets of the city of Spokane was a valuable right. At that time, as an artificial fuel, gas was without a competitor. It was then a strong competitor in the lighting field. Now it is not a competitor in the latter field, and is almost completely outdistanced in the former by electricity and oil. It is still used for cooking by a substantial number of people. But it is not used by a sufficient number to make operation, under the franchise, profitable. The evidence shows that, for profitable operation, the company must have eighty-five customers per mile of main. It has but thirty-eight. In 1910, it had 11,030 customers. At the time of trial, it had but 6,121. It has plant equipment to serve three times that number. But customers are not available. *Page 487 
One cannot read this record without being convinced that gas companies are "on the way out." Yet they are still a great public convenience and necessity. Without gas, a substantial number of citizens who cannot afford electricity would be driven back to the use of coal and wood. It is to their interest that the gas company be not driven from the field — just as it is to the interest of people who cannot afford automobiles that street cars be retained. Moved by that consideration, the city has relinquished its right to franchise charges from the street railway company. It might do well to do the same for the gas company. For the franchise of the street railway company is just as valuable, or (depending on the point of view) as valueless, as the gas franchise. It is not conceivable that anyone would, at this time, apply for either a street railway or gas franchise in the city of Spokane — much less agree to pay for the privilege of operating under one.
The fact that this company is being mulcted by its parent holding company of one and three-fourths per cent of its gross revenues is, to my mind, wholly immaterial. The practice of holding companies of levying tribute on their operating companies presents an entirely different problem — a problem which the courts may soon be called on to examine at the behest of some injured minority or preferred stockholder. But it can have no possible bearing upon the reasonable value, under this franchise, of the use of the streets by the defendant.
I think the judgment of the trial court should be affirmed.
HOLCOMB, J., concurs with BLAKE, J.