Union Light, Heat & Power Co. v. Mulligan

• Decision Date: 09 November 1917
• Citation: 197 S.W. 1081,177 Ky. 662
• Parties: UNION LIGHT, HEAT & POWER CO. ET AL. v. MULLIGAN ET AL. UNION LIGHT, HEAT & POWER CO. ET AL. v. TRACY, JUDGE.
• Court: Kentucky Court of Appeals

197 S.W. 1081

177 Ky. 662

UNION LIGHT, HEAT & POWER CO. ET AL. v. MULLIGAN ET AL.

UNION LIGHT, HEAT & POWER CO. ET AL. v. TRACY, JUDGE.

Court of Appeals of Kentucky.

November 9, 1917

Appeal from Circuit Court, Kenton County; Criminal, Common Law, and Equity Division.

Action by Mary Mulligan and others against the Union Light, Heat &amp Power Company, in which Polk Laffoon, its secretary, was adjudged guilty of a civil contempt. From a judgment for plaintiffs, defendant appealed, and applied for writ of prohibition against Frank M. Tracy, Judge; the application being denied, and defendant appealing. Laffoon also appeals from the judgment against him. Judgment reversed, and writ of prohibition granted.

Ernst Cassatt & Cottle, of Cincinnati, Ohio, and Matt Herold, of Newport, for appellants.

Stephens L. Blakely, of Covington, for appellees.

MILLER J.

The appellant the Union Light, Heat & Power Company, hereinafter called the company for brevity, supplies natural gas to the residents of the city of Covington under a franchise contract, which permits the company to charge not exceeding 30 cents net per thousand cubic feet. For several years, at least during the period covered by this controversy, the company has charged the maximum contract price of 30 cents per thousand cubic feet.

In June, 1916, Mary Mulligan and ten other gas consumers filed their joint action against the company, alleging as causes of action that the company had been overcharging some of the plaintiffs by demanding advance payments or deposits of money to secure the payment of gas consumed by them, and had been charging others of the plaintiffs with the cost of the installation of service pipes leading from the company's main to the consumers' residences. By way of relief they prayed for a recovery of their money so paid, and for a decree enjoining the company from further requiring and demanding deposits or advance payments. After the plaintiffs had been required to paragraph their petition so as to state the several causes of action in separate paragraphs, they were further required to elect which of the causes of action they would prosecute. They elected to prosecute under the first paragraph for a recovery of their deposits. The plaintiffs who joined in that paragraph were 33 in number and their several claims aggregated $172, the largest being for $25, and the smallest for $3. They alleged that the questions involved in the action were of a common and general interest to all of the many consumers of gas in the city of Covington; that the consumers were numerous; that it was impossible to bring all of them before the court within a reasonable time; and that the plaintiffs brought the action, not only on their own behalf and benefit, but on behalf and for the benefit of all other consumers of gas and electricity within the city of Covington.

Conceiving that the causes of action of the several plaintiffs were several and not joint, and could not be joined, the company moved the court to require the plaintiffs to elect which one of them would prosecute the cause of action set up in the first paragraph, and to strike from the paragraph the names of all the other plaintiffs. This motion was overruled. The company then moved the court to strike from the petition the allegation that the questions involved were of a common and general interest to all the consumers of gas living in the city of Covington, and that the plaintiffs brought this action in their own behalf and on behalf and for the benefit of all the consumers of gas and electricity within the city of Covington because they were many and unknown to the plaintiff, and therefore impossible to bring them all before the court within a reasonable time. This motion raised, in a different way, the same question that had been theretofore decided upon the motion to elect as between the parties plaintiff; and it was likewise overruled. The company then filed a demurrer to the jurisdiction of the circuit court upon the ground that none of the demands of the plaintiffs was for as much as $50, but the demurrer was overruled.

By way of answer the company denied that some of the plaintiffs had made any deposits; and it also denied that the questions involved were of a common or general interest. The answer also affirmatively alleged that in the conduct and operation of its business of supplying gas to consumers, it was necessary for the company to adopt certain rules and regulations; that one of the rules adopted by it requires all consumers of gas to deposit with the company a sum in advance payment, to secure it against loss, sufficient in amount to cover the gas bill for the usual period of payments, the deposit to be returned to the consumer when it ceased to use gas and surrendered his deposit receipt issued to him by the company. Another rule of the company provides that all gas bills must be paid on or before 10 days subsequent to the rendition of gas bills; and yet another rule provides that consumers owning real estate in Covington, and consumers owning no real estate in that city, but who give to the company a written guarantee, signed by an owner of real estate, in said city as guarantor, other than married women, were not required to make a deposit or advance payment if they make such fact known to the company when they apply for gas service. The answer further alleged that the deposit made by each plaintiff had been made at a time different from that of any other plaintiff, extending over a period of many years, and that each plaintiff's deposit constituted a separate transaction between the depositor and the company.

Upon the motion of the plaintiff the plea of the rule as above stated was stricken from the answer as being immaterial. Thereupon the company filed an amended answer alleging that at the time the ordinance fixing the gas rate at 30 cents per thousand cubic feet was adopted, it had for more than 60 years been the uniform, continuous, and well-established custom and usage for gas companies furnishing gas to consumers to demand a reasonable deposit from consumers as security for the payment of gas bills, and that when the contract ordinance was accepted by the company it was contemplated by the parties to the contract that the company could and would demand, and the consumers would make, a reasonable advance payment to, or deposit money with, it to secure the payment for gas furnished to consumers. To this amended answer a demurrer was sustained, whereupon the company declined to further plead, and moved to submit the action for judgment. The motion was sustained, and the case was submitted on December 18, 1916.

On January 16, 1917, the plaintiff moved the court to set aside the order of submission, and the motion was sustained over the company's objection, whereupon the plaintiff, over the objection of the company, withdrew so much of the petition as amended and the prayer thereof as asked for an injunction. The court then entered an order referring the action to the master commissioner of the court, with instructions to ascertain the amounts paid by the plaintiffs and other gas consumers to the defendant company, under the contract of 1909 between the city and the company; when said amounts were paid as deposits; what sums in the possession of the company had been paid to it as deposits to secure the payment of gas bills; and to whom said sums were due. The order further directed the company to submit its books and records to the master, from which the master was directed to prepare a statement of the facts submitted to him by the order.

After the plaintiffs had withdrawn their allegation and prayer for an injunction, the company renewed its special demurrer, on the ground that since none of the plaintiffs' payments was in excess of $50, and the question of equity jurisdiction for injunctive relief had been eliminated from the case, the circuit court was without jurisdiction to try the case; and it also renewed its motion to require the plaintiffs to elect as between themselves as to who would prosecute the action since their alleged demands were several and not joint. The court, however, overruled the special demurrer and the motion.

Acting under the order of reference the plaintiffs then caused a subp na to be issued and served upon Polk Laffoon, the secretary of the company, commanding him to produce the company's books and records before the master commissioner on April 2, 1917; and, Laffoon having failed to obey the subp na, he was ruled to show cause why he should not be punished for contempt. The company and Laffoon responded that the books and records which Laffoon was requested to furnish were the property of the company; that there was no necessity for the production of any of the books or records of the company to establish the several deposits or payments made by the plaintiffs since they had been admitted in the pleadings; that the order directing Laffoon to produce the books and records was made for the sole benefit of persons who were not parties to the action, but for persons on whose behalf the plaintiffs were attempting to sue without the consent of such persons; that none of the amounts claimed by either of the plaintiffs was sufficient to give the circuit court jurisdiction of the subject of the action; that the plaintiffs knew all of these facts to be true and dismissed their action or prayer for an injunction over the defendant's objection, and for the sole purpose of preventing an appeal to the Court of Appeals by the company. Up to the time the order of reference was entered no order had been made permitting the plaintiffs to sue for the benefit of all others similarly interested, but an order to that effect was made after the order of reference had...