Landon v. Public Utilities Commission of Kansas

• Citation: 245 F. 950
• Decision Date: 13 August 1917
• Docket Number: 136-N.
• Parties: LANDON v. PUBLIC UTILITIES COMMISSION OF KANSAS et al.
• Court: United States District Courts. 10th Circuit. United States District Courts. 10th Circuit. District of Kansas

245 F. 950

LANDON v. PUBLIC UTILITIES COMMISSION OF KANSAS et al.

No. 136-N.

United States District Court, D. Kansas, First Division.

August 13, 1917

Chester I. Long, of Wichita, Kan., John H. Atwood, of Kansas City Mo., and Robert Stone, of Topeka, Kan., for complainant.

H. O Caster and F. S. Jackson, both of Topeka, Kan., for Public Utilities Commission of Kansas.

James D. Lindsay, of Jefferson City, Mo., for Public Service Commission of Missouri.

T. S Salathiel, of Independence, Kan., for Kansas Natural Gas Co.

J. A Harzfeld and A. F. Evans, both of Kansas City, Mo., for city of Kansas City, Mo.

H. J. Smith, of Kansas City, Kan., for city of Kansas City, Kan.

W. E. Stringfellow, of St. Joseph, Mo., for St. Joseph Gas Co.

T. F. Doran, of Topeka, Kan., for Consumers' Light, Heat & Power Co.

Charles Blood Smith, of Topeka, Kan., for Fidelity Title & Trust Co. and Sharitt, receiver.

Charles L. Faust, of St. Joseph, Mo., for city of St. Joseph, Mo.

E. F. Cameron, of Joplin, Mo., for city of Carl Junction, Mo.

M. T. January, of Nevada, Mo., for city of Nevada, Mo.

George J. Grayston, of Joplin, Mo., for Joplin Gas Co.

J. W. Dana, of Kansas City, Mo., for Wyandotte Gas Co. and Kansas City Gas Co.

BOOTH District Judge.

I had supposed until this morning that there was to be simply an informal conference by the receiver and his counsel in case No. 1351 Equity with reference to the question of the advisability of making a change in the rates for the coming winter and as to what those rates should be; but I am advised that other parties interested have been notified, and I think wisely so, as the conference might well take a broader scope than what I had supposed it was to take, because the question of rates is one in which a good many parties are interested. It is also a question upon which the court desires to get all the light possible before making any definite order.

It might very likely be of advantage, if not to all, at least to some of you, to know what decision has been reached upon the issues touching the Missouri defendants which were tried and submitted at Kansas City a few weeks ago in case 136-N Equity. I have not been able to prepare a written opinion for filing with regard to these issues; but I have, however, reached certain conclusions, and I think, perhaps, it would be just as well that I should state what these conclusions are at this time, and then, if I think it advisable, I will reduce them later to writing and have them filed. If this is the desire of the attorneys, I will follow this plan, because I think it may have some bearing upon the discussion as to what rates the court may order, and also have some bearing as to the position the attorneys may take upon one side or the other, and especially those representing Missouri defendants.

By a former decision, which was filed in April, and by a decree that was entered upon that decision, the issues in case No. 136-N, so far as they related specially to the Kansas defendants were disposed of, but the issues so far as they related specially to the Missouri defendants, and also the issue as to the status of the supply contracts, were held open for taking further evidence and for further consideration.

The jurisdictional questions raised by the Missouri defendants do not require further discussion. They have been disposed of by the former decisions, viz. the decision of the enlarged court, found in 234 F. 152, and the decision of this court filed April 21, 1917 (242 F. 658).

The principal issues in which the Missouri defendants are interested involve two main questions: First. Whether the acts of the Missouri Commission and of the Missouri defendants, or of certain of them, have been of such a character as to call for an injunction against them on behalf of the receiver. That question resolves itself into two subordinate questions: (a) Whether the business which is being carried on by the receiver, viz. the transportation of natural gas from Oklahoma and sale thereof in Missouri constitutes interstate commerce; (b) whether the acts of the Missouri Commission, or any of them, can be held to be acts which in effect deprive the receiver of the property of the company without due process of law. The second main question, and one in which not only the Missouri defendants, but also the Kansas defendants, are interested, is the question as to the status of the supply contracts originally made by the Kansas Natural Gas Company, or its predecessor, with various distributing companies, or their predecessors. This question, again, is divisible into two subordinate questions: (a) As to the status of the supply contracts as between the original parties or their assignees; and (b) the status of the supply contracts as to the receiver.

The relief sought by the receiver is: First, by way of injunction against the defendants, and especially against the Missouri Commission, restraining them from interfering with the carrying on of the business of transportation and selling of natural gas from Oklahoma into Missouri. The claim of the plaintiff is that the business thus carried on is interstate commerce, and that the Missouri Commission and some of the other defendants have attempted to unduly and directly burden this interstate commerce and to place restrictions upon it; and further it is claimed that the acts of the Missouri Commission in effect take away the property of the receiver without due process of law. Secondly, by way of injunction as against all of the defendants to prevent them or any of them from instituting any suits or proceedings or taking any steps without the consent of this court to enforce the provisions of the so-called supply contracts, which they claim, or which some of them claim, are still in force as against the receiver-- the receiver claiming: (1) That these supply contracts were invalid in their inception; (2) that, even if they were valid, yet, nevertheless, by reason of the changed circumstances, and by reason of the provisions in the contracts themselves looking towards a change of circumstances, they are no longer binding upon the original parties to these contracts; (3) that even if the contracts were valid in their inception, and still are existing valid contracts between the original parties, yet they are not at this time binding upon the receiver.

Similar relief is also sought by the Kansas Natural Gas Company and by several of the distributing companies. Several of the distributing companies and some of the cities take the position that these supply contracts are at present valid existing contracts upon the receiver as well as upon the original parties. Others of the distributing companies take the position that, while the contracts may be valid and existing between the original parties, yet they do not contend that they are binding upon the receiver.

Now, as to the question of interstate commerce, I have gone over the record as well as I could within the time that I have been able to give to it, and in my judgment the facts upon which this issue stands in regard to the Missouri defendants are substantially the same as in the case against the Kansas defendants. The differences in them are not vital, and most of them in my judgment are immaterial. The question of storage has been presented and pressed with great earnestness, as being a very important factor to be taken into consideration in determining this question of interstate commerce. But to my mind the evidence shows that such storage as exists is merely incidental to the...