Ottinger v. Consolidated Gas Co of New York
| Decision Date | 29 November 1926 |
| Docket Number | No. 357,357 |
| Citation | 272 U.S. 576,47 S.Ct. 198,71 L.Ed. 420 |
| Parties | OTTINGER, Attorney General of New York, v. CONSOLIDATED GAS CO. OF NEW YORK |
| Court | U.S. Supreme Court |
Messrs. John Holley Clark, Jr., and Charles E. Buchner, both of New York City, for appellant.
Messrs. John A. Garver and William L. Ransom, both of New York City, for appellee.
In Newton v Consolidated Gas Company, 258 U. S. 165, 42 S. Ct. 264, 66 L. Ed. 538, decided March 6, 1922, this court held that chapter 125, Laws N. Y. 1906, which prescribed an 80 cent per 1,000 feet gas rate, had become confiscatory and should not be enforced. Thereafter the New York Public Service Commission made careful investigation of the property and operations of appellee and prescribed a rate not exceeding $1.15 per 1,000 for gas of 537 British thermal units, effective October 1, 1922, to continue for one year. Acceptance of this order, the company now claims, consummated a binding agreement with the state. The Legislature, by an act approved June 2, 1923 (Laws 1923, c. 899), effective immediately, directed that thereafter in New York City not more than $1 per 1,000 feet should be demanded for gas of 650 British thermal units.
By an original bill in the United States District Court, Southern District of New York, wherein the Public Service Commission and the Attorney General of that state were the defendants, appellee attached the Act of June 2, 1923, as confiscatory, and prayed for an injunction prohibiting enforcement thereof. It also asked that the act be adjudged void, because enforcement would impair the company's contract with the state under the commission's order, contrary to article 1, section 10, of the federal Constitution, further, that the act be declared invalid because of the impossibility of supplying immediately and with safety to consumers gas of 650 thermal units. Answers followed, and the matter went to a master, who took much proof, found the value of the property dedicated to public use, cost of operation, the impossibility of furnishing safely gas of the prescribed standard, etc. He reported the $1 rate would not yield a fair return upon such property, estimated according to any reasonable standard, and therefore recommended that the act be declared confiscatory and unenforceable. He further recommended that it be declared invalid because in conflict with article 1, section 10, also because compliance therewith was practically impossible. The court confirmed this report without material modification, adjudged as recommended and granted the injunction prayed for. Consolidated Gas Co. of New York v. Prendergast (D. C.) 6 F.(2d) 243....
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