Pub. Serv. Comm'n v. Pavilion Natural Gas Co.

• Decision Date: 22 November 1921
• Citation: 232 N.Y. 146,133 N.E. 427
• Parties: PUBLIC SERVICE COMMISSION, SECOND DIST., v. PAVILION NATURAL GAS CO.
• Court: New York Court of Appeals Court of Appeals

232 N.Y. 146

133 N.E. 427

PUBLIC SERVICE COMMISSION, SECOND DIST.,

v.PAVILION NATURAL GAS CO.

Court of Appeals of New York.

Nov. 22, 1921.

Summary proceeding under Public Service Commissions Law, § 74, by the Public Service Commission, Second District, against the Pavilion Natural Gas Company. From an order of the Appellate Division (195 App. Div. 534,187 N. Y. Supp. 363) reversing, with one dissenting justice, the judgment of the Special Term (111 Misc. Rep. 692,182 N. Y. Supp. 55), defendant appeals.

Order of the Appellate Division reversed, and judgment of the Special Term affirmed.

Appeal from Supreme Court, Appellate Division, Third department.

J. M. E. O'Grady, of Rochester, for appellant.

Ledyard P. Hale and Harry B. Mintz, both of Albany, for respondent.

Arthur E. Sutherland, of Rochester, William F. Huyck, of Le Roy, and Clarence H. Greff, of Warsaw, amici curiae.

McLAUGHLIN, J.

The defendant is a gas corporation supplying natural gas to certain towns and villages in the counties of Wyoming, Genesee, and Livingston, under franchises or agreements fixing the maximum rate to be charged, in some cases at 40 and in others at 45 cents per M. cubic feet.

On August 12, 1919, the gas company filed a petition with the Public Service Commission for leave to raise the rates to 75 cents. Hearings were had upon the application from time to time until February 7, 1920, when the gas company filed with the commission a schedule of rates increasing the rates then existing to 85 cents per M. cubic feet, with a discount of 10 per cent. for prompt payment, same to take effect March 10, 1920. The commission, on the 15th of April following, instituted this proceeding, by a petition which, after setting forth the various franchises and agreements and their acceptance by the gas company, alleged that from and after March 10, 1920, defendant had charged and collected 85 cents per M. cubic feet, contrary to the limitations of said franchises and agreements, and without permission from the commission to do so. The defendant's answer did not controvert the material allegations of the petition, but alleged as a defense that by its own act of filing, on the 7th of February, 1920, a schedule of rates with the commission, it had, under subdivision 12 of section 66 of the Public Service Commissions Law (Consol. Laws, c. 48) legally increased the rate to 85 cents from and after March 10, 1920.

At the conclusion of the hearing before the Special Term the material facts involved were not disputed. There were simply two questions of law to be determined. One was whether the gas company could increase the maximum rates fixed in the franchises and agreements by simply filing a schedule of rates with the commission, the same to take effect 30 days thereafter; and, second, whether it could do so, notwithstanding the pendency of the proceeding instituted by it.

The court at Special Term held that the gas company had acted strictly within its legal rights and dismissed the proceeding. On appeal to the Appellate Division, that court, one of the justices dissenting, reversed the judgment and granted a new trial. The gas company appeals to this court, giving the usual stipulation for judgment absolute in case the judgment appealed from be affirmed.

Subdivision 12 of section 66 of the Public Service Commissions Law, which in its present form went into effect June 14, 1910 (Laws 1910, c. 480), after giving the commission power to require gas corporations to file schedules of rates, provides as follows:

‘* * * Unless the commission otherwise orders, no change shall be made in any rate or charge, or in any form of contract or agreement or any rule or regulation relating to any rate, charge or service, or in any general privilege or facility, which shall have been filed and published by a gas corporation, * * * except after thirty days' notice to the commission and publication for thirty days as required by order of the commission, which shall plainly state the changes proposed to be made in the schedules then in force and the time when the change will go into effect. The commission for good cause shown may allow changes without requiring the thirty days' notice under such conditions as it may prescribe. No corporation or municipality shall charge, demand, collect or receive a greater or less or different compensation for any service rendered or to be rendered than the rates and charges applicable to such services as specified in its schedule filed and in effect at the time. * * *’

[1] This provision of the statute was in force when certain of the towns and villages gave their consent to the defendant to maintain and operate its gas mains within the municipalities. This court has held, as to similar consents nTown of North Hempstead similar consents (Town of North Hempstead 447, 132 N. E. 144), that by implication the statute became a part of the terms of the consent, and that a gas...