Patterson v. Mobile Gas Co

• Decision Date: 26 April 1926
• Docket Number: No. 226,226
• Citation: 46 S.Ct. 445,271 U.S. 131,70 L.Ed. 870
• Parties: PATTERSON et al. v. MOBILE GAS CO
• Court: U.S. Supreme Court

271 U.S. 131

46 S.Ct. 445

70 L.Ed. 870

PATTERSON et al.

v MOBILE GAS CO.

No. 226.

Argued March 19, 1926.

Decided April 26, 1926.

Messrs. Hugh White and Harwell G. Davis, both of Montgomery, Ala., for appellants.

Mr. Harry T. Smith, of Mobile, Ala., for appellee.

Mr. Justice McREYNOLDS delivered the opinion of the Court.

The record in this cause has been made up with such disregard of the rules that we cannot undertake to examine the evidence or to discuss seriatim the 34 jumbled assignments of error. It would be permissible to dismiss the appeal, Newton v. Consolidated Gas Co., 42 S. Ct. 264, 258 U. S. 165, 174, 66 L. Ed. 538; but, considering the public interest and with purpose to prevent any serious miscarriage of justice, we have examined the pleadings, the master's report, the opinions and the decrees. In the circumstances we think the proper course is to modify and then to affirm the decree of the court below.

By an original bill of August 14, 1922, the gas company asked that members of the Alabama Public Service Commission be restrained from attempting to enforce a rate schedule which it alleged was confiscatory.

A supplemental bill, filed April 18, 1923, after referring to the original bill and proceedings thereunder, among other things, alleged: That, as provided by the Act of the Alabama Legislature approved October 1, 1920 (Gen. Acts 1920 (Sp. Sess.) p. 38) the commission ascertained and declared the value of the company's property for rate-making purposes as of December 31, 1921, at the latter's request and expense. That this valuation was made under a valid contract with the state and she was obligated to accept it for rate-making purposes. That by an unconstitutional act approved February 13, 1923 (Gen. Acts 1923, p. 62), the Legislature undertook to authorize, and the commission intended to make, another valuation. That so to do would violate the contract which the state deliberately entered into and greatly injure the company. In addition to the relief originally asked the prayer was for a decree declaring the commission's valuation final for all rate-making purposes and the challenged act invalid. Also for an injunction restraining the commission from attempting to establish any new valuation for rate-making purposes.

Upon application for an injunction under the supplemental bill the District Court-composed of two Circuit Judges and one District Judge-held (June 4, 1923) that no continuing contract between the state and the company resulted from the commission's action in respect of the first valuation and refused to enjoin the proposed revaluation. District Judge Clayton expressed another view.

Later-October 31, 1923-the District Court, Judge Clayton only presiding, entered the following final decree:

(1) That the value of the properties of the Mobile Gas Company as of December 31, 1921, has been definitely fixed for the future rate-making purpose by contract entered into by the state of Alabama, acting by and through the Alabama Public Service Commission, on the one part, and the Mobile Gas Company, on the other part, and that the defendants in this case and their successors in office are hereby forever enjoined from attempting to impair the obligations of this contract by failing or refusing to accept the said valuation as a permanent basic valuation as of December 31, 1921, for all future rate-making purposes.

(2) Also that the tariff of rates established by the Alabama Public Service Commission, by its order of July 24, 1922, is confiscatory and void, and further that the Mobile Gas Company is entitled to earn a net profit of 8 per cent. per annum upon $2,007,520.68, consisting of $1,969,565, which was established as the permanent basic...