Newark Natural Gas & Fuel Co. v. Newark, 242 U.S. 405 (1917)

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Newark Natural Gas & Fuel Company v. City of Newark

No. 232

Argued December 4, 1916
Decided January 8, 1917
242 U.S. 405

ERROR TO THE SUPREME COURT

OF THE STATE OF OHIO

Syllabus

A city ordinance fixing the maximum rate chargeable by a gas company will not be adjudged confiscatory if, at the time of the judicial inquiry, the net profits derivable under the ordinance will give a fair return upon the then value of the company’s property.

Plaintiff, a gas distributing company, whose rates were fixed by an ordinance, purchased its gas under a contract, which measured the vendor’s compensation by a percentage of plaintiff’s gross receipts. The contract antedated the ordinance, and had several years to run when suit was commenced. Plaintiff contended that, under the ordinance rate, the contract was no longer profitable to its vendor. Held that the effect of the ordinance upon the constitutional rights of the vendor was immaterial to plaintiff’s case.

The contract expired before the evidence was closed. Held that, for the purposes of this case, plaintiff not having shown what it paid afterwards, the contract might be assumed to measure plaintiff’s probable expense for gas during the life of the ordinance.

92 Ohio St. 393 affirmed.

The case is stated in the opinion.