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was thus occupied. This rental, as given in plaintiff's proof, was in 1891 and 1892 $2,502.95; in 1893, $2,428.76; and in 1894, $2,184.91. If these items are disallowed in gross, such disallowance would reduce the actual cost, as given by plaintiff, nearly 5 cents per 1,000 feet in 1891 and 1892, and nearly 4 cents in 1894; thus bringing the cost, in plaintiff's proof, to $i (about) in 1891, and to 89 cents (about) in 1894.

Turning to the testimony of the experts who testified on behalf of plaintiff as to what, in their judgment, is, or should be, the actual cost in Des Moines of manufacturing and distributing gas, we have the following results: Butterworth, 88 to 94 cents per 1,000 feet; Cowdery, 90 to 98 cents per 1,000 feet; Harper, 90 to 95 cents per 1,000 feet; White, 90 to 95 cents per 1,000 feet; Faber, 90 to 95 cents per 1,000 feet; Wallbridge, 90 to 95 cents per 1,000 feet; Chollar, 92 to 96 cents per 1,000 feet. I will not attempt recapitulation of the evidence of other witnesses, who placed the cost yet lower (some of that evidence bears marked indication of mere speculation on the subject), but will, for present purposes, take 90 cents as the cost per 1,000, in the belief that, under the proof thus far presented, this will be sustained as a fair estimate, and as not below the cost. The proof introduced by plaintiff shows that about 70 per cent. of the gas sold by it was at illuminating gas rates, and about 30 per cent. at fuel gas rates. Applying this percentage to the net rates of the 1895 ordinance, we have each 1,000 feet of gas bringing $1.21 per 1,000 feet. At a cost of 90 cents per 1,000, there will remain 31 cents per 1,000 of profit, or, at the output for 1894, a profit of $17,546. If we now take the cost of reproduction of plaintiff's gas plant, as hereinbefore found, the per cent. of profits on output for 1894, at the 1895 ordinance rates is .0438, or 4 per cent. on cost of reproducing such plant. Under the present state of the proof, I am not satisfied that any allowance should be made on the present hearing for interest on outstanding bonds. The evidence hereafter presented may convince me that this interest, or some part thereof, should be included, in determining what are reasonable rates herein.

It is insisted by defendant that the reduction in price of gas will work a corresponding and large increase in amount consumed, resulting in increase of net profits as well. That some increase in consumption will follow reduction in price, plaintiff admits, but insists that there is no basis for believing such increase will be large, or that the net profits will increase at all. What will be the amount or per cent. of increase in consumption, and whether any increase in profits will result from reduction of rates, is, and must at present be, an uncertain matter. In Railway Co. v. Wellman, 143 U. S. 343, 12 Sup. Ct. 400, Mr. Justice Brewer inquires:

“Must it be declared, as matter of law, that a reduction of rates necessarily diminishes income? May it not be possible–indeed, does not all experience suggest the probability-that a reduction of rates will increase the amount of business, and therefore the earnings? At any rate, must the court assume that it has no such effect, and, ignoring all other considerations, hold, as a matter of law, that a reduction of rates necessarily diminishes the earnings ?''

The same learned justice, in the opinion rendered by him on this circuit, as circuit judge, in Railway Co. y. Dey, 35 Fed. 881, when speaking of the application in that case of the possible increase of business as following reduction of rates, uses this language:

"Again, it is said that it cannot be determined in advance what the effect of reduction in rates will be. Oftentimes it increases business, and who can say that it will not in the present case so increase the volume of business as to make it remunerative,-even more so than at present. But speculations as to the future are not guides for action. Courts determine rights upon existing facts. Of course, there is always a possibility of the future; but the only fair judicial test is to apply the rates to the business that has been done in the past, and see whether, upon that basis, such rates will be remunerative, or will compel the transaction of business at a loss."

After all, there can be but one certain method of ascertaining the effect of reduction of rates, and that is the test of experience.

In plaintiff's opening argument, on page 43, appears a table wherein counsel have attempted to apply to a possible increase in business the rates of the 1895 ordinance, as affecting the receipts by the company therefor. Therein is shown a probable reduction in cost per 1,000 feet, as incident to such increased business. Let us take that part of the table, and, instead of placing the cost per 1,000 feet at plaintiff's figures (which are 95 cents), for present consumption, start our table at 90 cents, as above found, and thereafter reducing cost, as consumption increases, the same number of cents per 1,000 as reduced in such table, and we have the following as a result:

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This is the result most nearly approaching accuracy at which I have been able to arrive, under the proof presented. I realize that, of necessity, any result, attempted as accurate, must largely rest on probabilities, many of which may easily change, and many, if not all, of which, are shifting factors. But, taking the entire proof, I can do no better at this time. It may be here stated that the proof shows that, during the 20 years in which plaintiff has operated its gas plant, there has been paid in dividends, and in interest on bonds, less than $50,000. Apparently, what profits beyond that amount have been realized from the business have been applied to the building up of plaintiff's plants. Were this the final hearing of this case, and time had proven my computation accurate, and that the increase in consumption had not proportionately and profitably grown in response to decrease in rates, but that substantially the consumption was as now, I should be strongly inclined, with my present view of the law and the facts, to grant a permanent in

junction, if plaintiff be found entitled to include interest on bonds. There has been invested of cash (so the proof shows), in this gas plant, $466,522.93. In this amount is included nothing relating to the electric light plant, nor any part of the bonds which were given for the right to use gas patents. If these bonds are included, the investment in the gas plant amounts to $641,974.73 according to the proof. And considered from any standpoint of business enterprise, with the risks attending the business, the depreciation naturally occurring to the plant, the repairs which must constantly be in progress, the possibility (always imminent in a business enterprise such as this) of some invention or new process being found which would manufacture some satisfactory illuminant so cheaply as to make further operation of the plant financially impracticable, and the many other matters which must occur to a business mind when considering this gas plant as a financial investment,—all these strongly impress my mind that the per cent. of profit shown by the above table (assuming that interest on the $200,000 bonds should be paid) is not what plaintiff is entitled to under equal protection of the laws with other like business enterprises generally, and that compulsory rates, which only permit charges affording no larger returns, and when the business is carried on with all practicable prudence and economy, are not reasonable rates, and are not compensatory, within the meaning of the term "compensation," as that term is used and construed in the decisions which are binding authority on this court. It will be observed, also, that the figures above tabulated do not provide any opportunity for realizing from the business a sinking fund, or other means with which to provide for payment of the principal of the bonds when these shall mature. The language of Justice Brewer, above quoted, is pertinent in this connection: “The idea of reasonableness is justice, and that which is unjust cannot be reasonable.” Had plaintiff, in any manner, apparently sought to conceal any items pertaining to its business, which to defendant seemed material in this hearing, there might be some reason for doubting the correctness of the computations above inade. But so far as seemed material to plaintiff, and so far as defendant asked, the entire business and accounts of plaintiff were opened up for investigation and consideration from its commencement of business, in 1876, to the date of the hearing. But we have not yet reached the final hearing in the case. What is now uncertain may, by the time of final hearing, become certain and convincing. Possibly, the result thus obtained may be contrary to present appearances. Opportunity, meanwhile, will probably be offered to definitely determine the working out of the ordinance in practice, in its business application. The test of experience—the most supreme test-may have been applied. As to the propriety of this test, Mr. Justice Woods, in the case of Tilley v. Railroad Co., 5 Fed. 662, when speaking of a hearing before him in an application for injunction against the enforcement of rates fixed by a railroad commission, says:

“The officers of the railroad company declare that the rates' fixed by the commission will so reduce its income that it will not suttice to pay the running

expenses of the road and the interest on the bonded debt, leaving nothing for dividends to its stockholders. The railroad commissioners assert that their schedule was framed to produce eight per cent. income on the value of the road, after paying cost of maintenance and running expenses. Which view is the correct one, it is impossible to decide from the evidence submitted. There is, however, a conclusive way-and it seems to me it is the only one-by which this controversy can be settled, and that is by experiment. A reduction of railroad charges is not always followed by a reduction of either gross or net income. It can soon be settled which is right-the railroad company's officers, or the railroad commission in their view of the effect of the commission's tariff of rates, by allowing the tariff to go into operation.”

This language is quoted by Judge Brewer (Railroad Co. v. Dey, 38 Fed. 664) on a hearing before him upon an application for a preliminary injunction in this state against a tariff of rates prescribed by the railroad commissioners of Iowa. Judge Brewer, after making the quotation, adds:

"While quoting this language as applicable hereto, I do not indorse it as of universal application, but only under the circumstances of the present case. Where the effect of the rates is doubtful, with a probability that they will prove compensatory, and the amount of business to be thereby affected is comparatively small, I think the courts may well wait for the test of experience. Influenced by these considerations, I am led to refuse the preliminary injunction, and to set aside the restraining order heretofore entered. It may well be that by the time this case comes to a final hearing the test of experience will have solved some of these matters, and it may be clear-as now seems probable --that the rates imposed by this last schedule are compensatory, within the rule laid down in the prior opinion, in which case an injunction ought not to issue, or clear that they are not compensatory, in which case, beyond any doubt, in my mind, a final and permanent injunction ought to be granted."

Is there, from the proof herein, such danger to plaintiff--such showing of irreparable injury to plaintiff-as to require that the preliminary writ shall issue? Taking the situation of plaintiff and defendant, where are the pressing, the controlling, equities? Plaintiff, at furthest, will receive within 40 cents per 1,000 feet of the prices heretofore received. According to the proof as now presented, plaintiff will pending this suit receive some profit. It is not compelled, as were plaintiffs in the Reagan and Ames Cases, to perform its business at ruinous or destructive rates, and without any compensation. The final hearing herein need not long be delayed, with a decision had on the merits, upon all the evidence that may be presented.

I have not attempted to notice herein all the points argued or pressed by counsel. Were I to attempt such presentation, this opinion, already too lengthy, would be greatly prolonged. I have given to the consideration of this application much time and study, through different methods of computation as to the items involved. About 10 days were occupied with the matter at the oral hearing in last August. The printed briefs of counsel were received after I had entered upon the fall sessions of this court, in September. These sessions continue, without interruption, until in December. I have devoted the past three weeks to the investigation of the proof and law presented, to the exclusion of other pressing official business. The nature of this case not only justified, but required, this exclusive and unremitting attention. The proof consists of


many hundreds of typewritten pages, with numerous tabular exhibits. The presentation by counsel of the facts and principles of law involved has been unusually thorough and complete, and consistent with the important financial and public interests involved, and as would have been confidently expected from the eminent legal standing and recognized ability of counsel representing the parties. If the court has erred in the conclusions reached, certainly such result cannot be charged to failure of counsel in presenting the case. I do not find in the proof presented and conclusions reached herein such showing as, when opposed to the prima facie proof of reasonableness of rates which accompanies and must be given to the ordinance, requires or justifies the issuing of a preliminary injunction. Accordingly the application for a preliminary injunction is denied, to which plaintiff excepts.

PRESTON V. FINLEY, Comptroller.


Demurrers which are unsupported either by certificate of counsel or affidavit of the party, as required by equity rule 31, must be disregarded, but they may be considered as grounds of objection to granting a pre


The act of the Twenty-Fourth legislature of Texas which provides for levying a tax on the occupation of selling the Sunday Sun, the Kansas City Sunday Sun, or other publications of like character, is not in contravention of article 1, § 8, of the state constitution, relating to the liberty of the press, or of article 8, § 2, relating to uniformity of taxation. Thompson v. State, 17 Tex. App. 253, and Baldwin v. State, 3 S. W. 109, 21 Ter.

App. 591, followed. 8. SAME-TITLES OF Laws.

The subject of the said act is sufficiently expressed in its title, within

the requirement of article 3, § 35, of the state constitution. 4. SAME.

The provision of article 1, & 10, cl. 2, of the constitution of the United States, that no state shall, without consent of congress, lay any imposts or duties on imports, etc., does not apply to articles brought into the

state from a sister state. Woodruff v. Parham, 8 Wall. 136, followed. 6. SAME-INTERSTATE COMMERCE-NEWSPAPERS.

Newspapers are subjects of commerce, within the meaning of the pro vision in the constitution of the United States relating to commerce be

tween the states. & SAME.

The Texas statute imposing an occupation tax of $500 upon every person, firm, or association engaged in selling the Sunday Sun, the Kansas City Sunday Sun, or other publications of like character, being applicable to all persons, whether residents of the state or not, engaged in selling "publications of like character" with those specifically mentioned, is not a discrimination either against the person or the property of the owners of the publications named, and is therefore not invalid as a regulation of Interstate commerce. This bill, duly sworn to by H. L. Strohm, Esq., one of the attorneys of complainant, was brought by Henry L. Preston, a citizen of the state of Missouri, against the comptroller of public accounts of this

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