Corporation Commission v. Cannon Mfg. Co.

• Decision Date: 21 February 1923
• Docket Number: 474.
• Parties: CORPORATION COMMISSION ET AL. v. CANNON MFG. CO. ET AL.
• Court: North Carolina Supreme Court

116 S.E. 178

185 N.C. 17

CORPORATION COMMISSION ET AL. v. CANNON MFG. CO. ET AL.

No. 474.

Supreme Court of North Carolina

February 21, 1923

Appeal from Superior Court, Cleveland County; Bryson, Judge.

Petition by the Southern Power Company to the Corporation Commission to fix reasonable rates, opposed by the Cannon Manufacturing Company and others. From an order of the superior court, to which an appeal had been taken by certain of the respondents overruling the motion of the respondents to dismiss the proceedings and to set aside the order of the Commission and remand with instructions, those respondents appeal, and the Attorney General on behalf of the Commission excepts to the overruling of his motion to dismiss the appeal to the superior court on the ground that respondents had no right of appeal. Appeal of respondents dismissed as being fragmentary and premature.

Where numerous respondents appealed from a decision of the Corporation Commission to the superior court, three of them cannot sever themselves from the effects of such appeal by conceding the reasonableness of the rates fixed by the Commission and moving to dismiss solely for want of jurisdiction.

This is a petition filed by the Southern Power Company, petitioner before the Corporation Commission, in November, 1920, for an increase of rates on electric power supplied by petitioner to its customers within the state, and on the alleged ground that the existent rates were insufficient to afford petitioner a reasonable return on a fair value of the property used in the generation, sale, and distribution of such electricity, and to enable the petitioners to supply and furnish efficient and adequate service to the members of the consuming public "demanding service from petitioner"; the rate suggested as necessary being at 1.4 cents per kilowatt hour to an amount of 50,000 kilowatt hours per month for primary power, with a larger scale where a less amount of such power is taken and a diminishing scale of prices where the quantity is greater. There was also a fixed sum requested for secondary at 1 cent per kilowatt hour for first 50,000 kilowatt hours per month, with an increasing and diminishing scale for smaller and larger quantities.

On the filing of the petition, the Commission caused notices to be issued and served on all the customers of the petitioner within the state having contracts with the company for electric power, and also a copy of the petition filed by said company; the number of such customers being about 280. Of these customers some 80 or more appeared and objected to the proposed increase, and 30 or 40 filed answers stating their objections in general terms and setting forth also long-term contracts held by them with petitioner in which said company had contracted and agreed to supply the holders with electric power at rates greatly less than those proposed in the petition both for primary and secondary power.

The Commission held a full investigation of the case, the different hearings extending from November, 1920, to July 1921, and during such proceedings it appears that both petitioners and respondents were represented by counsel, and all evidence relevant to the inquiry was duly considered including the contracts set out and relied upon by respondents in bar of the proposed increase; this last petition appearing not only from the presumption of correct findings on the part of the Commission as expressly provided in the statute, but from a proper perusal of the record, which will disclose that these contracts set up by respondents were nowhere challenged or denied by the petitioner and were discussed and treated throughout as being in evidence and relevant to the questions at issue in the cause.

At the close of the hearing, and after due consideration, the Commission, on July 8, 1921, entered their formal order, appearing in the record and to be taken as part of this statement, in which they fixed and declared as reasonable and just rates to be charged by petitioner for electricity, 1.25 cents per kilowatt hour for primary power for amount of 50,000 kilowatt hours per month, with an increasing or diminishing charge for less or greater amounts per month. And they also, as shown in their order, fixed the reasonable and just charge for secondary power at 1 cent per kilowatt hour for 50,000 kilowatt hours per month, with an increasing and diminishing charge for a less or greater quantity, the amount so fixed upon being, as shown, less than that asked for by petitioners but greater than the amount agreed upon in the contracts set up and in part relied upon by the respondents.

On the filing of this order a large number of respondents acquiesced in the findings of the Commission and determined to make no further protest against the rates fixed upon. Appeals to the superior court being taken by 23 or more of the respondents, constituting three groups of mills holding long-time contracts, and which may be designated as the Cannon group, the Johnston group, and the Cone group, this last consisting of the Proximity Manufacturing Company, the Belle View Manufacturing Company, and the Revolution Cotton Mills, and being the appellants in No. 480. Said appeal was transferred for hearing to the superior court of Cleveland county, where, at special term, July, 1922, it was submitted and heard before Bryson, Judge, and a jury, on the following issue: "Were the rates fixed and set forth in the several schedules contained in the order of the State Corporation Commission of July 8, 1921, unjust and unreasonable to the consumers of such power and current?"

At or before the impaneling of the jury, the Cone group of mills, admitting that the rates fixed by the Commission were reasonable and just, withdrew all exceptions to the issues and findings of fact and moved to dismiss the appeal and proceedings for that the Corporation Commission was without jurisdiction or power in the premises:

First, because this attempted regulation affected and concerned interstate commerce and in such form and fashion that Congress alone could deal with it.

Second, that our own statute constituting the Commission restricted its powers of rate regulation to "intrastate traffic," and did not extend therefore to the rates in question here, as same, according to their position, concerned only "interstate commerce."

The motion was overruled, and this group of respondents excepted.

The Cannon group and the Johnston group, while joining in the motion to dismiss because the subject-matter was interstate commerce, insisted on their exceptions of fact and introduced their evidence on the issue, and same was submitted to the jury under a clear and comprehensive charge of the court. While the jury were considering of their verdict, counsel for these two groups moved further that the order of the Commission be set aside and the proceedings be remanded with instructions, for errors of law apparent on the face of the record:

First, that on the admitted facts and as a conclusion of law, the rates fixed by the Commission would bring about an unlawful discrimination in favor of the holders of certain contracts for power at a lower rate existent in the state of South Carolina.

Second, for errors in the basic principles of valuation under which the rates fixed upon were estimated.

These motions were disallowed, and respondents excepted.

The jury having failed to agree upon a verdict, a juror was withdrawn and a mistrial had, and the issue is now on the superior court docket undetermined. The Cone group of mills appealed to Supreme Court from the refusal of his honor to allow their motion to dismiss for lack of jurisdiction and his declining to sign a separate judgment to that effect, the court being of opinion that a separate right of appeal did not arise to these appellants. The Cannon group and Johnston group took an appeal from the order overruling their motion to dismiss, and their motion to set aside the order of the Commission and remand, with instructions, as heretofore stated. The record further discloses that at the call of the cause for trial in the superior court, the Attorney General, in behalf of the Corporation Commission, having obtained leave for the purpose, moved to dismiss the appeal of the respondents for that no right of appeal existed for any of the respondents on the facts presented. Motion was overruled, and the Attorney General excepted.

The appeals of the respondents appearing on the docket as two cases were consolidated by consent, and argued, considered, and determined as one, presenting, however, the different interests of the parties as disclosed in the record.

On the hearing in this court, there was motion by the power company, the petitioner, to dismiss the appeals as being fragmentary and premature.

E. T. Cansler and John M. Robinson, both of Charlotte, C. R. Hoey and O. Max Gardner, both of Shelby, and W. S. O'B. Robinson, Jr., of Charlotte, for petitioner Southern Power Co.

Tillett & Guthrie, of Charlotte, J. C. Biggs, of Raleigh, A. G. Mangum and A. C. Jones, both of Gastonia, and O. M. Mull and D. Z. Newton, both of Shelby, for Cannon Mfg. Co. et al.

R. R. King, of Greensboro, S. M. Gattis, of Hillsboro, and Parker & Long, of Graham, for Cone group of mills.

HOKE, J. (after stating the facts as above).

Our legislation more directly pertinent to this controversy, C S. c. 21,§§ 1035, 1066-1068, 1083-1090, 1097, 1098, 1100, et seq., confers upon the Corporation Commission power to make reasonable and just rates and charges to prevail as to intrastate traffic by certain designated public service companies, including those engaged in furnishing electricity, electric light current, power or gas, etc. The statute, more particularly in ...