State ex rel. Columbia Telephone Company v. Atkinson
| Decision Date | 29 May 1917 |
| Citation | 195 S.W. 741,271 Mo. 28 |
| Parties | THE STATE ex rel. COLUMBIA TELEPHONE COMPANY, Appellant, v. JOHN M. ATKINSON et al., Members of Public Service Commission |
| Court | Missouri Supreme Court |
Rehearing Denied 271 Mo. 28 at 40.
Appeal from Cole Circuit Court. -- Hon. J. G. Slate, Judge.
Reversed and remanded (with directions).
McBaine & Clark and W. M. Williams for appellant; Hugh Dabbs of counsel.
(1) This court will examine, consider, and weigh the evidence and reach its own conclusions and findings of fact upon the testimony in the record, as in equity cases; and, in effect try the case de novo. Railroad v. Public Service Comm., 266 Mo. 333. (2) The Public Service Commission "has made an omnibus allowance, without itemization in findings, opinion, or order," and, if it can be said that this is a compliance with the statutory requirement of "findings of fact in writing," it certainly cannot be of material aid to the court in making its findings upon this record. Gas & Elec. Co. v. Barker, 231 F. 331; Sec. 101, Public Service Com. Act., Laws 1913, p. 634-5; People v. Wilcox, 210 N.Y. 479. (3) The owner of property devoted to public use is entitled to a fair and reasonable return upon his entire investment used in serving the public. Such valuations should not be so low or the investments looked upon with such disfavor as to hamper enterprise or discourage investments of private capital in the service of the public. No public interest requires the omission of any element of value from the allowance upon which a public service company may make a fair return. The valuation put upon the Columbia Telephone property by the Public Service Commission was entirely too low, and should not be permitted to stand. Knoxville v. Water Co., 212 U.S. 18; Railroad v. Railroad Comm., 136 Wis. 146; Printing Co. v. Gas & Elec. Co., 4 Wis. R. C. R. 648. (4) It is well settled, in valuing public service properties, that a fair allowance must be made for "going value" or "cost of development." The Commission in this case made no definite allowance for "going value" or "cost of development." Omaha v. Water Co., 218 U.S. 180; Gas Light Co. v. Cedar Rapids, 223 U.S. 665; Minnesota Rate Case, 184 F. 765, 230 U.S. 352; Wilcox v. Gas Co., 212 U.S. 17; Express Co. v. Ohio, 166 U.S. 185; Waterworks Co. v. Kansas City, 62 F. 853; Trust Co. v. Railroad, 90 F. 683; Waterworks v. San Francisco, 124 F. 574. (5) All the authorities are to the effect that a fair allowance should be made for cash working capital. While the Commission referred to it in its opinion, no definite allowance was made for such capital. Whitten, Valuation of Public Service Corporations, p. 287; Floy, Valuation of Public Utility Properties, p. 125; Tel. & Tel. Co. v. Louisville, 187 F. 646; Printing Co. v. Gas & Elec. Co., 4 Wis. R. C. R. 501; Cunningham v. Chippewa W. L. Co., 5 Wis. R. C. R. 316; Gas Co. v. New York, 157 F. 849; Weaver v. Light Co., 1 Mo. P. S.C. 165; In re Missouri Southern Ry. Co., P. U. R. 1916 C. 645; Springfield v. Gas & Elec. Co., P. U. R. 1916 C. 381. (6) If, from the cost of the property, there is to be deducted the actual depreciation, then there must be added to the depreciated value of the property the reserve fund set apart to make good such depreciation. Wilcox v. Gas Co., 212 U.S. 17; Knoxville v. Water Co., 212 U.S. 1; Murray v. Public Service Comm., 150 P. 47; Whitten, Valuation of Public Service Corporations, 350. (7) The rule of the Columbia Telephone Co., requiring an advance payment of three dollars to be credited on the last month or months of the year's subscription is reasonable and just. The installation of a telephone for less than a year's subscription entails a loss to the company. The order of the commission, permitting an advance collection for three months, is no fairer to the subscriber than the company's rule, and does not furnish adequate protection to the company. Similar rules to that of the Columbia Telephone Co. have been approved by other Public Service Commissions. 1 Pond, Public Utilities, 219. (8) Reasonable classification of subscribers for telephone service is entirely proper and may be made by the company. The separate classification by the Columbia company of rooming houses with a rate between private residences and business houses is proper under the conditions shown to exist in that locality.
Alex. Z. Patterson and James D. Lindsay for respondents; N. T. Gentry of counsel.
Counsel for appellant complain that the valuation on the Columbia Telephone plant was fixed too low by the commission; and they insist that the Supreme Court should review the case and decide that the weight of the testimony on that subject is in their favor. Even if this court will review the testimony on that subject, this court will certainly give to the finding of the commission as much weight as the finding of a trial court, when there is some testimony to support it. After a long and patient investigation, after numerous continuances and the introduction of a flood of evidence (which to say the least was contradictory), the commission made its finding. Appellant contends that the additional sum of fifty cents per month from each boarding house and rooming house is a reasonable charge, although counsel for appellant do not cite us to a single town or city where such a practice has been adopted. It is claimed by appellant that the telephone rates in Columbia are not too high, because of the large number of students in Columbia attending the State University, yet appellant then wants to add to the already high rate an additional charge of fifty cents per month for houses where students room or take their meals. Such extra charge is not made in other cities and towns of our State, nor in other college towns, nor in the capital city, nor in any of the cities where state institutions are located. It is a charge peculiar to the Columbia Telephone Company. The intimation that students of the University use the telephones so much more than the students of the other college towns of our state and nation, and so much more than any other kind of boarders in other towns, can hardly be taken seriously. Perhaps the most unreasonable charge about which complaint is made is the so-called "Advance Payment," or as stated to other patrons the "Installation Fee" or "Deposit Fee," sometimes called the "Removal Fee." If the testimony can be believed, the telephone company has one rule for one person and another rule for another person. Some persons were charged one dollar, some one dollar and a half, some two dollars, and the easy ones three dollars. All of the new subscribers of the telephone company pay some sort of a charge, which is also unknown to other Missouri towns. It is now charged by the telephone company that a fee of three dollars, as an advance payment, is reasonable, that it can make no money by renting a phone for less than one year. This is an argument that may well be addressed to one who is contemplating going into the telephone business; but it is no reason for requiring one person to pay one sum as rent for a telephone for nine months, and another person to pay another sum for the same length of time. Under our present law such discrimination is prohibited. Besides the telephone company is receiving pay for services never rendered.
This proceeding was instituted on the 20th day of May, 1915, in the circuit court of Cole County, to review on certiorari the action of respondents in two cases, one of which was known as case No. 69, entitled "J. Ben Sims v. Columbia Telephone Company;" the other was known as No. 282, entitled "In the matter of the Valuation of the Telephone Exchange Rural Lines and Long Distance Toll Lines of the Columbia Telephone Company." These cases were consolidated and tried as one before the Public Service Commission.
Case No. 69 filed before the commission was sworn to by J. Ben Sims and signed by thirty-one other residents of the city of Columbia, making complaints against the Telephone Company, as follows:
(1) That the rates of the Columbia Telephone Company were excessive as compared with other university towns and towns of like population;
(2) That where one or more boarders or roomers were in the house of a subscriber an additional charge was made;
(3) That where an extension telephone was put in by the company an additional charge of fifty cents per month was made;
(4) That the Telephone Company should furnish free all telephones used by the city and the public schools, which it failed to do;
(5) (a) That a charge was made for installing telephones; (b) that a charge was made to the residence in which a telephone was installed when one tenant moved out and another moved in;
(6) That the Telephone Company refused to place telephones lower than three and a half feet from the floor for the reason that if telephone users could sit down they would use the telephone more than if they had to stand up.
Case No. 282, filed before the commission, was signed by forty-nine citizens of Columbia requesting the Public Service Commission to investigate the Columbia Telephone plant and place a valuation thereon, on the ground that the petitioners believe the rates charged in the city of Columbia were too high; a reduction of rates was asked. Case No. 282 will be treated as a part of the complaint (1) in case 69.
After hearing the cases, the commission found against the complainants in favor of the Telephone Company as to complaints (1), (3), (4) and (6). The commission found against the company on complaint (2), holding that the rule of the company, classifying as boarding-houses private residences having two or more boarders or roomers and charging them an...
To continue reading
Request your trial