RATES continued.

of the property. Duluth Street R. Co. v. Railroad Commission (Wis.)

192.

10. Chapter 41, Acts of the Legislature 1907 (Code 1913, chap. 54,
§§ 71fI, 71fII [§§ 3020, 30211]), limiting railroads to the rate of 2 cents
per mile for carrying intrastate passengers and baggage, remains the
paramount law, binding upon the carrier, until in the first instance,
upon application by the carrier, or by someone injuriously affected
thereby, or upon the initiative of the Public Service Commission, such
rate has been investigated by the Commission and judicially determined
to be unreasonable or confiscatory as to a particular carrier, and there-
fore invalid, and until then or until such law has been otherwise amend-
ed or lawfully nullified, the Public Service Commission has jurisdic-
tion, as prescribed by the act creating it, to compel observance by a
carrier of such law. State ex rel. Public Service Commission v. Balti-
more & O. R. Co. (W. Va.) 558.

11. Since the decision of this court in Coal & Coke R. Co. v. Con-
ley, 67 W. Va. 129, 67 S. E. 613, the act of 1913, creating the Public
Service Commission, inaugurated a new system of regulating public
service corporations, and that act must be read and interpreted along
with chapter 41, Acts of 1907 (Code 1913, chap. 54, §§ 71fI, 71fII [§§
3020, 3021]), and all other previous regulatory statutes, not repealed
thereby, as in pari materia therewith, and as together constituting the
law of the state regulating and controlling all public service corpora-
tions. State ex rel. Public Service Commission v. Baltimore & O. R.
Co. (W. Va.) 558.

12. The state Commission has power to regulate rates for trans-
portation between two points within the state which is purely local in
character, although the carrier may perform similar service with re-
spect to interstate transportation. Chicago, M. & St. P. R. Co. v.
State Public Utilities Commission (Ill.) 133.

13. The State Public Service Commission may, upon complaint of
the shipper, pass upon the reasonableness of a purely local rate, al-
though the Interstate Commerce Commission, upon the complaint of
the same shipper, had refused to pass upon the reasonableness of such
local rate, since it was a part of a through rate and could not be
considered apart from its relationship to the through rate from inter-
state points of origin. Chicago, M. & St. P. R. Co. v. State Public
Utilities Commission (Ill.) 133.

14. The Maryland Commission, under the Public Utility Statute
(Code Pub. Civ. Laws), § 435 of article 23, and the amendatory act,
chap. 162, of the Acts of 1912, has full power to regulate railroad com-
mutation rates. Pennsylvania R. Co. v. Towers (Md.) 398.

15. The Maryland Commission does not, by the establishment of
single-rate railroad fares, exhaust its powers so as to prevent it from
regulating commutation rates. Pennsylvania R. Co. v. Towers (Md.)
398.

16. The California Commission has power to establish a second
through route and joint rate where the existing through route and rate

RATES-continued.

do not furnish adequate and satisfactory service to passengers. Tarpey
v. Southern P. Co. (Cal.) 621.

III. Powers of courts.

See also COURTS.

17. The question whether railroad passenger or freight rates pre-
scribed by statute are reasonable or unreasonable and confiscatory is a
judicial question, exclusively for determination by the courts. State
v. Chicago, M. & St. P. R. Co. (Minn.) 797.

18. Until the Public Service Commission, pursuant to the authority
conferred upon it by said act, has investigated and determined that a
particular rate complained of is unreasonable and invalid as to a par-
ticular carrier, the courts cannot interfere by injunctive process, or
otherwise, to stay the hand of the Commission in the performance of its
proper duties and functions. State ex rel. Public Service Commission
v. Baltimore & O. R. Co. (W. Va.) 558.

19. The Federal court of the district of Minnesota had jurisdiction
of an action brought by the stockholders of the various railroads of the
state to test the validity of chapter 97 of the laws of 1907 (Gen. Stat.
1913, §§ 4288, 4289), known as the 2-cent fare law, and authority and
jurisdiction by injunction to restrain such companies, their agents
and officers, from putting in force, during the pendency of the action,
the rate prescribed by that statute. State v. Chicago, M. & St. P. R.

Co. (Minn.) 797.

20. For practical reasons courts ought not to entertain suits at the
instance of individual consumers to enjoin a public service corporation
from placing in effect a schedule of rates which does not exceed the
maximum fixed by the proper legislative body. St. Paul Book & Station-
ery Co. v. St. Paul Gaslight Co. (Minn.) 474.

IV. Reasonableness; factors to be considered.

As to presumption of reasonableness of rates passed upon by Commis-
sions, see EVIDENCE, 1-3, 5, 7.

Burden of proof as to reasonableness, see EVIDENCE, 11-16.
Order fixing, to be given test of practical trial where evidence as to
its unreasonableness if conflicting or uncertain, see RETURN, 2.
Distinction between unreasonably low and confiscatory rates, see RF-
TURN, 3-6.

Small return as a whole not ground for excessive charge for a par-
ticular service, see RETURN, 5.

Factors to be considered in determining reasonableness of rates of a
distributing company controlled by owners of producing company,
see RETURN, 7.

a. In general.

21. A rate is "unreasonable, unjust, oppressive, and unlawful," as
against the carrier, if it does not fairly compensate the carrier for its
services. Union P. R. Co. v. Public Utilities Commission (Kan.) 377.

22. The Commission, in deciding whether or not a rate is reason-
able, cannot be influenced by any consideration of the precedent which
may or may not be established by its order. Railroad Commission v.
Bell Teleph. Co. (Nev.) 276.

23. A public service company exercising an exclusive privilege
should charge such prices as will make its supply available to as large
a portion of the public as is consistent with its right to a reasonable
compensation for the service rendered. Natick Petitions (Mass.) 655.

24. The cost of the service, and not the value thereof to the public,
is the proper criterion by which to test the reasonableness of rates
charged by a utility which constitutes a natural and necessary monop
oly. Duluth Street R. Co. v. Railroad Commission (Wis.) 192.

25. Net earning power is one of the most important elements to be
considered in ascertaining whether rates of fare are reasonable or
otherwise. Duluth Street R. Co. v. Railroad Commission (Wis.) 192.

26. Rates should be so fixed as to allow to a utility economically
and efficiently managed, revenues adequate to meet its operating ex-
penses and fixed charges, and to allow a fair return upon the capital
honestly and prudently invested; and rates which are either too low or
too high, judged by this standard, are unjust and unreasonable either
to the utility or to the public. Re Gassaway Development Co. (W. Va.)
551.

27. The fact that no dividends were paid during the first thirty-five
years of a gas company's life is not a substantial ground for the main-
tenance of existing prices, complained of as unreasonably high, where,
owing to the lack of time and intervening changes of management, it is
impossible to determine whether failure to obtain a fair return was
due to lack of good management or to some attribute in the venture
itself, and where, even if there was no mismanagement, it is hardly
to be assumed that purchasers of the stock of such a company would
have considered the possible right to be reimbursed for the lack of divi-
dends in past years as a material element of value. Marlborough Gas
Petitions (Mass.) 781.

28. Although a gas company is concededly entitled to a return on the
original cost of all of the property now actively and necessarily em-
ployed for the public convenience, and although the investment so repre-
sented should be kept good, the management should not attempt to
shoulder upon the public the full burden of such past losses and im-
prudences as it has inherited. Marlborough Gas Petitions (Mass.) 781.

b. Comparison of rates.

29. In the absence of testimony showing a similarity of conditions,
a length of time sufficient to test the effect of a proposed advance in
wood-pulp rates, the compensation produced by them as compared
with the outlay, and other important facts, it would be unsafe to rest
a decision as to the reasonableness of such rates upon a comparison
with the rates upon the same commodity in other jurisdictions. West
Virginia Pulp & Paper Co. v. Pennsylvania R. Co. (Pa.) 11.

RATES-continued.

c. Voluntary rates.

30. It is proper for the Public Utilities Commission, in establishing
coal rates between Pittsburg, Kansas, and Concordia, Kansas, on purely
intrastate transportation, to use the voluntary intermediate rates estab-
lished and long maintained by the carriers as a basis for fixing such
rates. Union P. R. Co. v. Public Utilities Commission (Kan.) 377.

31. Although tables of comparative freight rates may show that an
intrastate coal rate fixed by the Public Utilities Commission is extreme-
ly low, they cannot be held to prove that the rate complained of is
unprofitable when the same intrastate rates on the same commodity
have been voluntarily established and long maintained by the carriers
in other portions of the state. Union P. R. Co. v. Public Utilities Com-
mission (Kan.) 377.

V. Discrimination.

For discrimination in rates, see DISCRIMINATION, I.

VI. Rates of particular utilities.

a. Coach companies.

32. A coach company, operating as a public carrier, was refused an
application for an increase in its rates, although it appeared that its
gross revenue was not sufficient to take care of the operating expenses
and the taxes, where the service was poor, and the schedules filed with
the Commission by the company were not being regularly maintained,
and these conditions had been repeatedly brought to the attention of
the company. Re Metropolitan Coach Co. (D. C.) 740.

33. In the absence of data as to maximum normal demands of any
class of customers, either seasonal or diurnal, of electric corporations,
the connected load of each class of service was taken as a determining
factor in certain computations and apportionments of expenses which
normally would be made upon a peak load demand basis in determining
the reasonableness of electric rates schedule. Campbell v. Hood River
Gas & Electric Co. (Or.) 855.

34. In making electric rate schedules the demand should be considered
as a percentage of the connected load, depending upon the class of sery-
ice; and wall receptacles, baseboard receptacles, or any other socket
or receptacle which it is clearly evident is not to be used for lighting
purposes, and small heating and power devices not exceeding a total
connected load of 2 kilowatts, should not be included in the connected
load in determining the demand rating; and in cases where the actual
demand of lighting loads, as ascertained by actual measurement, exceeds

RATES-continued.

or is less than the estimated demands to the extent of 20 per cent or
more for connected loads of 5 kilowatts or less, and 10 per cent or more
for connected loads of over 5 kilowatts, the measured demand should
prevail. Campbell v. Hood River Gas & Electric Co. (Or.) 855.

35. A schedule of electric rates not based on the connected load, ad-
heres more closely to public policy than one based upon such load, in
that it tends to the encouragement of reasonable and convenient use of
the company's service by small users who usually form a majority of
the subscribers to the service of a public utility. Re Rockland Elec-
tric Co. (N. J.) 683.

36. An electric company will be restrained from raising its rates
for power where it appears that the status of the company's business
has not changed materially since a 6 per cent dividend was declared,
and the company failed to show that current for power was furnished
at a loss under the old rates. Elliott v. Big Spring Electric Co. (Pa.)

20.

2. Reasonableness of particular rates.

37. Minimum monthly charges of $1 for city customers, and $1.25
for rural customers, were held to be just and reasonable, and a minimum
monthly charge of $1.50 to rural utility customers was held to be un-
reasonable and excessive. Campbell v. Hood River Gas & Electric Co.
(Or.) 855.

38. A schedule of electric rates originally ordered, which provided
for a charge of 18 cents per kilowatt hour for the first two hours of
connected load, and a charge of 9 cents per kilowatt hour for the next
two hours' use, with a charge of 43 cents per kilowatt hour for all use
of the connected load in excess of four hours per day, was directed to
be changed so as to provide for a lower basic rate of 17 cents per kilo.
watt hour for the first 120 hours' use and 9 cents per kilowatt hour
for all excess current, with certain quantitative discounts for meter
service and an optional schedule of flat rates, where it appeared that
the conditions of operation of the plant were such as to bring about a
lower cost only after the plant had been in operation with good load
for at least four hours, and where there were certain large users of
current who the Commission considered must be given consideration,
even though their average number of hours' use was not as great as was
that of some other customers. Re New Egypt Light, Heat, Power &
Water Co. (N. J.) 820.

39. A rate for metered electric lighting service of 13 cents per kilo-
watt hour, less one cent per kilowatt hour for payment within fifteen
days, was held to be a just and reasonable rate under the circumstances
of the case. Re Rockland Electric Co. (N. J.) 683.

40. That a flat rate for electricity for water heaters amounts only
to about one fourth the cost of the service if the consumers use their
heaters twenty-four hours a day on high is not sufficient to overcome
the presumption of reasonableness attaching to a voluntarily established
rate, particularly where the heating service is furnished in connection
with electric service for cooking, which is a very profitable service, and