Elk Hotel Co. v. United Fuel Gas Co.

83 S.E. 922, 75 W. Va. 200, 1914 W. Va. LEXIS 241
CourtWest Virginia Supreme Court
DecidedDecember 8, 1914
StatusPublished
Cited by8 cases

This text of 83 S.E. 922 (Elk Hotel Co. v. United Fuel Gas Co.) is published on Counsel Stack Legal Research, covering West Virginia Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Elk Hotel Co. v. United Fuel Gas Co., 83 S.E. 922, 75 W. Va. 200, 1914 W. Va. LEXIS 241 (W. Va. 1914).

Opinion

Dyncii, Judge:

The plaintiff, Elk Hotel Company, a corporation, owns a building and in it conducts a hotel in the city of Charleston. The United Fuel Gas Company is a corporation supplying natural gas for fuel for heat and light to the inhabitants of the city, under a franchise granted by the municipality. It •offered gas to domestic consumers at the rate of twenty two cents for each thousand cubic feet consumed, with a reduction of two cents per thousand cubic feet for prompt monthly payments. To manufactories it offered a reduced rate, graduated according to the quantity consumed, provided the monthly consumption was not 'less than one hundred thousand cubic feet, with a deduction of one cent per thousand cubic feet for prompt payment. The first rate is one charged to residents of the city whose dwellings are fitted with grates ■or stoves for heating purposes, and denominated the rate to domestic consumers or the domestic rate, the rate to man-ufactories being known as the manufacturing rate; service to the first class, domestic consumers, being defendant’s ehief incentive or inducement for acceptance of the franchise so granted and the installation of its gas system in the city of Charleston. To all hotels, including plaintiff’s, equipped with open fires and stoves, it furnished gas at the rate charged domestic consumers; and, while so served and charged, none of them complained, and, so far as disclosed, they do' not now ■complain when, for reasons hereafter stated, they are required to accept and pay for gas at the same rate.

[202]*202Having a supply of gas in excess of tbe quantity required for domestic consumption, especially during the summer months, defendant offered to supply the surplus- at the rate charged to manufactories located in or near the city, for consumption under boilers for the generation of steam, and included in its offer the several hotels of the city, among them, the plaintiff’s, provided they installed boilers in their buildings for heating by steam or by hot water instead of open fires and grates, upon the condition, expressed in the contracts therefor, that when so equipped defendant would install two meters, one to measure the gas consumed under the boilers for heating purposes and charged for at the manufacturing rate, the other to measure the gas consumed for all other purposes and charged for at the domestic rate,, reserving in all contracts for gas supplied at the reduced rate the right to discontinue the service at such rate whenever defendant should deem the surplus necessary for its consumers, including hotels, served at the domestic rate. While other hotels equipped their buildings with boilers as required by defendant and accepted the limitation as to- the continuity of service, plaintiff declined to make any such changes or agree to the conditions imposed, the former solely because of the additional expense incident to the installation of a boiler and changes in plumbing necessary for such service; so that thereafter defendant continued to supply gas to it at the rate charged domestic consumers.

. Being in arrears for bills then two months overdue, and making no tender thereof defendant demanded payment, plaintiff, upon a bill for the purpose, obtained from the circuit court of Kanawha county an injunction restraining defendant from shutting off the gas supply to its building, as it had threatened to do unless such bills were promptly paid. But, upon the defendant’s motion, accompanied by its answer duly filed, denying plaintiff’s right to relief upon the facts stated in the bill, to which answer plaintiff did not tender or file any replication, the court — hearing the case, by agreement or acquiescence of counsel, upon bill, answer and motion — dissolved the injunction and dismissed the bill. From the decree so entered plaintiff has appealed.

[203]*203Under the pleadings and the circumstances and conditions of the case, the only material inquiry is whether the classification of consumers made by defendant, the requirement as to uniformity in hotel equipment, and the diversity of rates charged, are unjust because discriminatory against plaintiff or unduly preferential to its competitors. Specifically stated, •our inquiry is limited to the question whether defendant’s division of hotels into two classes, those having one character of equipment and willing to enter into contracts subject to interruption or discontinuance whenever deemed necessary by the gas company for the benefit of its domestic consumers, and those not so equipped and unwilling to enter into such contracts, the rate charged each class being different, is an unjust discrimination in favor of one and against the other class of consumers. . -

That a public service corporation may classify those whom •it serves, and fix different rates for each character of service,' is elementary; or, as stated by 2 "Wyman on Pub. Serv. Corp. §1232, “from the very nature of the case classification goes far back into the law of public service”," the only legal inhibition being that it must not give an undue or unreasonable preference or advantage to or make an unfair discrimination among its consumers or patrons where the conditions are alike and the circumstances similar. Mercury v. Power Co., 19 Pa. Super. Ct. 519. Though not applicable or controlling, because enacted subsequent to the institution of this suit, and not being expressly or impliedly retroactive, chapter 9, acts 1913, does not deny the right and power of such corporations to make just and equal classification of its patrons and fix different compensatory rates for services rendered to each of them, so long as the classification and the rates are not unreasonable or discriminatory. 36 Cyc. 1205; Barker v. Hinton, 62 W. Va. 639; Gas Co. v. Commission, 80 S. E. 940.

No authority is cited, and none found upon this investigation, which specifically notes the distinction involved here. But the decisions are uniformly to the effect that to constitute an unjust discrimination, either under the federal act to regulate commerce or at common law, the charge must be for like and contemporaneous service “under substantially sim[204]*204ilar circumstances and conditions”. Commission v. Railroad Co., 145 U. S. 699. There the court held party tickets issued at a lower rate did not unjustly discriminate against the purchaser of an individual ticket at the regular rate, the difference being one cent a mile for the distance traveled. Mr. Justice Brown, quoted with approval from the opinion cf the lower court, saying: “In respect to passenger traffic the positions of the respective persons or classes between whom differences in charges are made must be compared with each other, and there must be found to exist substantial identity of situation and of service, accompanied by inequality or partiality resulting in undue advantage to one or undue disadvantage to the other, in order to constitute unjust discrimination”; and, further, that railroad companies are, “under the act, only bound to give the same terms to all persons alike under the same circumstances and conditions.” The mere circumstance that advantage denied to one person enures to the benefit of another does not of itself show an undue preference to the latter. Commission v. Railroad, 5 Int. Com. Rep. 671.

An undue or unreasonable advantage or preference by a public service corporation results only from allowing to one person what it denies to another under substantially the same circumstances and conditions. 3 Moore on Carriers 1795; Telegraph Co. v. Publishing Co., 44 Neb. 326.

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Cite This Page — Counsel Stack

Bluebook (online)
83 S.E. 922, 75 W. Va. 200, 1914 W. Va. LEXIS 241, Counsel Stack Legal Research, https://law.counselstack.com/opinion/elk-hotel-co-v-united-fuel-gas-co-wva-1914.