Court Opinion

ID: 5376932
Source: CourtListenerOpinion
Date Created: 2022-01-08 08:40:44.149834+00
Date Added: 2024-06-11T08:30:04.310135
License: Public Domain

Sohenck, J.
(dissenting). I dissent on the ground that the Commission in fixing the temporary rates did not comply with section 114. While the Court of Appeals has held that this section authorizing the determining of temporary rates is constitutional (Matter of Bronx Gas & Electric Co. v. Maltbie, 271 N. Y. 364, 373), it clearly indicated that such temporary rates must be fixed in accordance with the provisions of the section, which definitely require among other things that such “ temporary rates so fixed, determined and prescribed shall be sufficient to provide a return of not less than five per centum upon the original cost, less accrued depreciation, of the physical property of said public utility company used and useful in the public service ”.
There are no disputed questions of fact here, no answer having been interposed by the Commission. It appears from the complaint and affidavits, which therefore stand admitted, that the rates fixed by the Commission will yield two and nine tenths per cent, or a sum less than the minimum return fixed by the statute. The recoupment clause of section 114 does not warrant a disregard of the other provisions of the same section, and treating the allegations of the complaint as admitted, it must be found that the rates were not fixed in. conformity with the statute and were not calculated to yield the return which the Legislature has determined to be the minimum return to which the utility is entitled.
In the circumstances, the utility must necessarily seek equitable relief. We may not hold that it must be required to continue to operate under a rate which amounts to a confiscation of its property for an indefinite period. The recoupment scheme of the statute will be of little avail if by reason of these temporary rates sufficient revenue will not be forthcoming to meet operating costs and taxes and which may result in bankruptcy.
The court below has held that “ the Commission acted within the frame of its statutory powers ’ ’. With this I cannot agree for the statute specifically provides for a minimum return which has not been afforded the utility by the Commission’s orders. In authorizing the Commission to fix temporary rates, the Legislature provided definite requirements, including a minimum return of not less than five per cent. This was a condition precedent and unless the Commission proceeded in accord*79anee with this as well as all of the other provisions of the statute, the utility is entitled to equitable relief. “ Even the Legislature may not confiscate petitioners ’ property for a year or two years or during any period, and much less the Public Service Commission without legislative power. The constitutional inhibition as to confiscation applies to temporary as well as to permanent rates.” (Matter of New York Edison Co. v. Maltbie, 244 App. Div. 436.) We are not concerned with the question of a “ fair return ” or with the “ deferment of a fair return ” to be hereafter made up by the recoupment provision. The question here presented is whether the utility is entitled to a temporary rate which will afford it the minimum return guaranteed by section 114. Unless we are to consider this provision as meaningless, the answer must be in the affirmative. From the admitted allegations of the complaint the temporary rate so fixed will yield a return of but two and nine-tenths per cent. It challenges the validity of the Commission’s order and the plaintiff is entitled to the independent judgment of a court of equity upon the law and the facts.
The orders and judgment should be reversed and. the plaintiff’s motion for temporary injunction granted.
Hill, P. J., and Heffernan, J., concur with Cbapser, J.; Schenck, J., dissents in a memorandum in which Bliss, J., concurs.
Orders and judgment appealed from in all respects affirmed and the appellant’s motion for a stay pending the appeals denied, with fifty dollars costs and disbursements.