Smith v. Southern Bell Tel. & Tel. Co.

• Decision Date: 20 April 1937
• Citation: 268 Ky. 421,104 S.W.2d 961
• Parties: SMITH v. SOUTHERN BELL TELEPHONE & TELEGRAPH CO.
• Court: Kentucky Court of Appeals

104 S.W.2d 961

268 Ky. 421

SMITH v. SOUTHERN BELL TELEPHONE & TELEGRAPH CO.

Court of Appeals of Kentucky

April 20, 1937

As Modified on Denial of Rehearing May 11, 1937.

Appeal from Circuit Court, Pike County.

Suit by W. Taulbee Smith, circuit court clerk of Pike county, against the Southern Bell Telephone & Telegraph Company. Judgment for defendant, and plaintiff appeals.

Affirmed.

W. W Barrett, of Pikeville, for appellant.

J. J Moore and Henry J. Scott, both of Pikeville, and Trabue Doolan, Helm & Helm, of Louisville, for appellee.

BAIRD Justice.

W Taulbee Smith, circuit court clerk of Pike county, Ky. sued the Southern Bell Telephone & Telegraph Company, doing business in Pikeville, Pike county, Ky. to compel it to furnish service to his public office in the following manner:

"(1) Telephone service confined to Pikeville exchange, with no toll calls either inbound or outbound, or

"(2) Both exchange and toll service,--exempting him, however, from liability for tolls on inbound or outbound calls unless the Telephone Company shall first make sure that plaintiff consents to pay tolls on such calls."

Appellee raised the question by proper pleadings that the Kentucky Public Service Commission authorized by chapter 145, Acts of 1934, pages 580-613 (Ky.Stat. §§ 3952-1 to 3952-61), prescribes a full and complete code of laws regulating and fixing schedules, services, rates, charges, practices, rules and regulations, as to the operation of utility companies, including telephone and telegraph companies; that the schedules, services, rates, charges, practices, rules, and regulations, under which the company was operating, had been approved and fixed by the commission; that the primary and exclusive jurisdiction over the regulation and supervision of the services, rates, rules, etc., had been, by the terms of the act conferred upon the commission, and full, complete, and ample remedies are given by the act; that the act provided for an adequate court review of the commission's orders, acts, etc.

It occurs to the court if the primary jurisdiction is in fact in the commission, that question should be first decided.

The Public Service Commission is an administrative agency set up and appointed by law for the purpose of hearing the facts and establishing reasonable rules, rates, and services to the public in order to secure conformity of services and rates affecting all classes of customers, because for this burden to fall exclusively on the courts and to give the courts the primary and exclusive jurisdiction to pass upon the reasonableness of the rules, services, rates, schedules, practices, etc., of the telephone and telegraph companies, would lead to confusion and uncertainty, because the result might be that one court would say that certain rules and regulations are unreasonable, and another court might regard the same rules reasonable; consequently, a subscriber of the same class in one locality might obtain one kind of service and the same service be denied a subscriber at another place.

No one is denied his day in court, because the right of review is adequately provided for by the act under section 3952-44, which reads as follows:

" Court review.--Any party to a proceeding before the commission, or any utility affected by an order of the commission, may within twenty days after service upon it of the commission's order or from the time when the commission has failed to act within the period prescribed in Section 6 (d), * commence an action in the circuit court for Franklin County or any other court of competent jurisdiction against the commission as defendant to vacate or set aside such order or determination on the ground that it is unlawful or unreasonable.

"If a petition for rehearing has been made as provided in Section 6 (d) * of this act, the right to commence an action against the commission shall be continued for a period of twenty days from the service of the final order in such rehearing upon the party desiring to commence the action. (1934, c. 145,§ 7 (a). Eff. June 14, 1934.)

"* § 3952-36."

The subject of services, rates, practices, rules, and regulations is so complicated and oftentimes so fraught with difficulties and varying circumstances that the business of the country has made it wise for the Legislature to enact such laws prescribing a system of regulation and supervision of public utilities such as telephone and telegraph companies, making it necessary to give the commission the primary authority and jurisdiction to hear complaints, receive and hear testimony of witnesses, and the power to fix reasonable regulations of toll and exchange service, as has been done in the instant case, a violation of such rules by the company in serving the public being subject to heavy fines and penalties.

In the case of Southern Bell Telephone & Telegraph Co. v. City of Louisville, 265 Ky. 286, 96 S.W.2d 695, 696, the court said:

"The commission was given jurisdiction over certain utilities enumerated in the act, including telephone and telegraph companies, and was empowered to fix just and reasonable rates after a hearing upon reasonable notice, its findings to be subject to judicial review. Subsection (n) of section 4 of the act empowers the commission, after a hearing has been had in the manner prescribed in the act, 'to enforce, originate, establish, change and promulgate any rate, rates, joint rates, charges, tolls, schedules or service standards of any utility, subject to the provisions of this act, that are now fixed or that may in the future be fixed, by any contract, franchise or otherwise, between any municipality and any such utility, and all rights, privileges and obligations arising out of any such contracts and agreements regulating any such rates, charges, schedules or service standards, shall be subject to the jurisdiction and supervision of the commission.' That it was the intention of the Legislature to clothe the Public Service Commission with complete control over rates and services of the utilities enumerated in the act is evidenced by the concluding paragraph of section 4, which reads:

"'Nothing in this section or elsewhere in this act contained is intended or shall be construed to limit or restrict the police jurisdiction, contract rights, or powers of municipalities or political subdivisions, except as to the regulation of rates and service, exclusive jurisdiction over which is lodged in the Public Service Commission.'

"Every utility subject to the regulation of the commission is required to file with the commission a schedule showing all rates then being collected, and is required to adhere to such schedule until a change is authorized by the commission after a hearing as provided for in the act."

We also said in the above case, supra, that the authority to regulate rates and modes of conducting the business of public utilities is primarily a legislative function of the estate and the right is a police power. Home Telephone & Telegraph Co. v. Los Angeles,...