Home Coal Company v. City of Macon

• Decision Date: 07 April 1924
• Parties: HOME COAL COMPANY, Appellant, v. CITY OF MACON, Respondent. *
• Court: Kansas Court of Appeals

262 S.W. 59

216 Mo.App. 590

HOME COAL COMPANY, Appellant, v. CITY OF MACON, Respondent. *

Court of Appeals of Missouri, Kansas City

April 7, 1924

Rehearing Denied 216 Mo.App. 590 at 599.

Appeal from Circuit Court of Macon County.--Hon. Vernon L. Drain Judge.

REVERSED AND REMANDED.

Judgment reversed and cause remanded.

George N. Davis for appellant.

C. G Buster and Ed. S. Jones for respondent.

OPINION

BLAND, J.

This is an action to recover the sum of $ 4201.51, alleged to be the amount of over-charge for electric current furnished by the defendant to plaintiff from August, 1918, to October, 1921. The case was referred to a referee who reported findings of fact and conclusions of law and recommended that judgment be entered in favor of the defendant. Plaintiff filed its exceptions to the referee's report, which was overruled. Judgment was rendered for the defendant, resulting in this appeal.

The findings of fact made by the referee having been approved and confirmed by the trial court occupy the same status upon appeal as the verdict of a jury and such findings will not be distributed if supported by substantial evidence. [Kline Suit Co. v. Morris, 293 Mo. 478, 494.] There is evidence in the record of the following facts: Plaintiff operated two coal mines as No. 1 and No. 2, the first being within the corporate limits of the City of Macon and the second near that city but outside of the corporate limits. The defendant city operated a municipal light plant in said city and furnished light and power to the inhabitants and industries thereof and to some industries outside the city limits, including mine No. 2 owned by plaintiff. Defendant had a schedule of rates graduated according to the amount of electricity used, the larger users paying less than the smaller. The rates for lighting were different and higher than the rates for power.

Some years prior to the time plaintiff claims the city began to exact from it charges higher than it was empowered to make, plaintiff operated mine No. 1 partially by electricity and obtained its current from the defendant and paid therefor four cents per kilowatt hour. This charge was fixed in 1912 by ordinance of the city fixing the schedule of rates, and filed with the Public Service Commission of the State. At no time, although the rates were afterwards increased to five cents per kilowatt hour for a short time, which plaintiff paid, and afterwards to six cents per kilowatt hour, was any further schedule filed with the Public Service Commission, and defendant could not legally charge a higher rate than four cents per kilowatt hour under the provisions of the laws of this State. [Art. 4, Chap. 95, R. S. 1919.] It is to recover the difference between four cents per kilowatt hour and six cents that plaintiff paid defendant from August, 1918, to October, 1921, that this suit was brought.

Some time prior to the occasion of the increase in the rate to six cents per kilowatt hour, plaintiff acquired mine No. 2, which was electrically and more modernly equipped than mine No. 1. There was no other source from which plaintiff could procure its electricity except from the defendant city, and it became necessary to construct a power line to mine No. 2, which was done by the city, but the cost thereof was advanced by plaintiff to the city under a contract with the city wherein it was agreed that plaintiff was to be reimbursed for the money advanced by credits upon its light bills for electricity used at mine No. 2. Afterwards the bills for electricity furnished both mines were paid in this way until the cost of the line, which was $ 2850, was fully repaid to plaintiff.

Plaintiff was defendant's largest user of electricity and defendant's plant became of insufficient capacity to furnish electricity to its light users and plaintiff. The latter got only one-half service. The mines were being run at full capacity and the coal administrator urged the production of the greatest amount of coal possible. Complaint was made by the president and superintendent of the coal company to the city that it was not getting sufficient electricity. There were times after supper when defendant would have to turn off the lights in different parts of the city in order to let the mines run. The plant broke down due to overload. There was considerable agitation for an extension and improvement of the municipal light plant at this time and a representative of the fuel administration appeared at Macon and urged upon the city council to put in another unit so that sufficient electricity could be furnished to plaintiff's mines. The president of plaintiff appeared before the city council and Mayor and discussed the matter with them. There were a number of meetings of the council held. On account of the rising price of coal, material and labor used in the operation of the plant, it was necessary to raise the price of electricity furnished the users. It was decided that a bond issue should be submitted for the purpose of adding another unit to the plant, which was done and $ 45,000 was voted and this sum, together with $ 15,000 more which came out of the general revenues of the city, was spent in enlarging the plant. At these meetings the question of revenue to be derived from the installation of new equipment and machinery came up and it was decided that it would be necessary to increase the rates. The president, secretary and treasurer of plaintiff solicited the council to put in the additional unit and agreed to the raise in the rate. Mr. Forgey, the secretary and treasurer of plaintiff, stated that he would be glad to get electricity at six cents per kilowatt and "that if it was ten cents, that was cheaper than putting in machinery and running it himself." This statement was made when the request for the power line to mine No. 2 was made and the enlargement of the light plant was being discussed.

It seems that at a meeting of the council on September 9, 1918, an ordinance was passed increasing the rate to six cents per kilowatt hour. There is some question as to the regularity of the proceeding under which the increase was made or whether a formal ordinance was passed, but it seems that it was agreed, and it was understood by the members of the council, that they were passing an ordinance charging six cents but it was discovered in 1921 that the ordinance did not in fact raise the rate. The city officials acting on the theory that the rates had been raised, increased the rates of all consumers on September 15, 1918, and to six cents to the plaintiff.

It seems that there was a very close relation existing between the officers of the plaintiff and defendant; some of the officers of plaintiff during most of the time that the alleged excessive rates were being collected were members of the city council and some of them served on the light committee. There was a meter at each of the mines and plaintiff was permitted to read its own meters each month and report the result to the city; the city figured the charges and sent bills to plaintiff with the charge fixed at the rate of six cents per kilowatt. These bills were paid. Plaintiff was at times permitted to get behind in its payments on these bills to the city. There was evidence on the part of plaintiff that after the raising of the rate to six cents, its secretary and treasurer protested to the city officials that the rate was too high, claiming that the rates were higher than the rates charged by other light plants for the same service. In...