Grafton County Elec. Light & Power Co. v. State

Citation77 N.H. 539,94 A. 193
PartiesGRAFTON COUNTY ELECTRIC LIGHT & POWER CO. et al. v. STATE.
Decision Date04 May 1915
CourtSupreme Court of New Hampshire

Appeal from Public Service Commission.

Petitions by the Grafton County Electric Light & Power Company and others for orders permitting the purchase by one corporation of the property of the others. From an order of the Public Service Commission dismissing the petitions, the petitioners appeal. Order set aside, and case remanded.

See, also, 77 N. H. 490, 93 Atl. 1028.

It appeared in evidence that the cost of the property of the Lebanon and Mascoma Companies to the owners of the Grafton County Company was substantially its book value, which largely exceeded its capitalization. The commission were of opinion that the property was worth a larger amount, but that its capitalization at its value would be contrary to the public good. The Lebanon and Mascoma Companies are physically connected, but serve different localities. The separation of accounts necessarily involved in keeping up the organization of both companies was deemed by the Commission to be of importance upon the issue of public good. They were also of opinion that the results sought by the petitions would in effect violate the stock dividend statute (P. S. c. 273, § 11), and that the petitions should be dismissed for that reason.

Benjamin W. Couch and Streeter, Demond, Woodworth & Sulloway, all of Concord, and Thomas W. Streeter, of Boston, Mass., for plaintiffs. Louis E. Wyman, of Manchester, for the State.

PEASLEE, J. The Public Service Commission having found that the proposed transactions would be contrary to the public good, the appeal brings that question here for consideration. The measure by which the matter is to be determined is described by the Legislature as "the public good." Laws 1911, c. 164, § 13, as amended by Laws 1913, c. 145, § 13. This is equivalent to a declaration that the proposed action must be one not forbidden by law, and that it must be a thing reasonably to be permitted under all the circumstances of the case. If it is reasonable that a person or a corporation have liberty to take a certain course with his or its property, it is also for the public good. It is the essence of free government that liberty be not restricted save for sound reason. Stated conversely: It is not for the public good that public utilities be unreasonably restrained of liberty of action, or unreasonably denied the rights as corporations which are given to corporations not engaged in the public service.

The public utilities statute includes individuals as well as corporations in the category of those subject to supervision and regulation. Id., § 1. This act is primarily one to regulate public utilities rather than corporations. The regulation of corporate activities is undertaken solely from a public service standpoint, and the powers conferred are to be administered accordingly. There is nothing in the statutes relating to public service corporations which in any way tends to contradict or limit this theory. Ample provision is made for supervision, to the end that unreasonable conduct may be restrained, but there is no suggestion that the affairs of public service corporations are to be treated on any but a sound business basis. The questions here are then: Are the proposed transfers, consolidation, and increased capitalization, or any of them, (1) contrary to law or (2) unreasonable?

In the consideration of these matters upon appeal, the court is required to give the weight prescribed by the statute (Laws 1911, c. 164, § 22 (e), added to the original act by Laws 1913, c. 145, § 18) to the findings, rulings, and orders of the Public Service Commission. In this the proceeding differs from an ordinary appeal, and a review of the acts and reasoning of the commission is enjoined upon the court. The order dismissing the application as contrary to the public good, is based by the commission upon both of the grounds indicated above. It was thought that the transactions, in effect, violated the stock dividend statute (P. S. c. 273, § 11), and also that they were objectionable upon other and more general grounds.

1. Is the capitalization of a surplus prohibited by the stock dividend statute? It is to be noted that there is no provision upon the subject in the general corporation law. The only statute relating to it is one imposing a penalty for participation in the declaration of a stock dividend. There is no provision that a corporation shall not sell all its property and receive the full value thereof, even if the sale be to a new corporation whose stock is to be taken in payment by the old corporation or Its stockholders. The capitalization of a surplus by means other than a stock dividend is not prohibited. Clearly the criminal law relating to stock dividends cannot be extended so as to cover such a transaction. As there is no other statute upon the subject, the conclusion that the transactions here under consideration are forbidden by law is unsound.

2. Is there substantial reason why the application should be denied? The reasons given by...

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18 cases
  • Appeal of Conservation Law Foundation of New England, Inc.
    • United States
    • New Hampshire Supreme Court
    • January 31, 1986
    ...financing will be in the "public good," id., as being "reasonable taking all interests into consideration." Grafton Etc. Co. v. State, 77 N.H. 539, 542, 94 A. 193, 195 (1915). Thus, in Appeal of Easton, 125 N.H. at 205, 480 A.2d at 88, we followed longstanding law in holding that a financin......
  • State ex rel. McKittrick v. Missouri Public Service Com'n
    • United States
    • Missouri Supreme Court
    • November 18, 1943
    ... ... Missouri Public Service Commission, Laclede Power & Light Company, and Union Electric Company of Missouri ... Kings County, Wash., v. Seattle School District No ... 1, 278 F. 46; ... effect. State ex rel. Gas & Elec. Co. v. Trimble, ... 307 Mo. 536; State ex rel. Public ... unjust and unreasonable. Grafton County Electric v ... State, 77 N.H. 539, 94 A. 193 ... ...
  • New England Tel. & Tel. Co. v. Department of Public Utilities
    • United States
    • United States State Supreme Judicial Court of Massachusetts Supreme Court
    • February 28, 1951
    ...States v. Public Utilities Commission of District of Columbia, 81 U.S.App.D.C. 237, 158 F.2d 533, 537; Grafton County Electric Light & Power Co. v. State, 77 N.H. 539, 542, 94 A. 193; Village of Boonville v. Maltbie, 245 App.Div. 468, 473-474, 283 N.Y.S. 460, affirmed, 272 N.Y. 40, 4 N.E.2d......
  • State ex rel. McKittrick v. Public Service Comm.
    • United States
    • Missouri Supreme Court
    • November 18, 1943
    ...not establish or tend to establish that the order complained of is unlawful, unjust and unreasonable. Grafton County Electric v. State, 77 N.H. 539, 94 Atl. 193. (11) Upon the record of the proceedings before the Commission it affirmatively appears that the order complained of is lawful, ju......
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